Bank of Ireland increase differential on tracker rates
The story of the Bank of Ireland decision to increase to the differential (interest rate margin) on tracker mortgages started on this forum when a professional landlord contacted Property118 within minutes of a letter from Bank of Ireland landing on his door mat. What ensued was outrage from landlords and affected residential mortgage borrowers. The story was quickly picked up by the National Media as it wasn’t just the 13,500 affected borrowers who were worried.
Will this set a precedent for other mortgage lenders to follow?
Property118 reacted by using funds donated to The GOOD Landlords Campaign to underwrite the cost of a barristers opinion on the legality of the Bank of Ireland’s actions. The remainder of this thread,one of the most read and most commented threads of all time on Property118, continues to tell the story as it unfolds.
If you want to skip the story and cut to the chase simply CLICK HERE
Of the 13,500 affected borrowers, 1,200 have had the decision reversed by Bank of Ireland. With additional support and pressure we believe all affected borrowers can and will see justice done.
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Lee, a professional Landlord asks, “help! I have just received a letter from the Bank of Ireland stating they want to increase the differential on my tracker rates.
I have 12 mortgages with the Bank of Ireland previously Bristol and West. I have been on a base rate tracker of 1.75% above base, but now Bank of Ireland are using some fine print claiming they have to recapitalise and saying the ‘new differential will be 4.49%.
How can I fight back?”
The original policy wording seems to be:
6 INTEREST
Charging interest at a tracker rate
(j) Unless we change the differential (if any) under condition 6 (n), we will not change the tracker rate unless the base rate changes.
(m) in condition 6 (n):
– a “positive differential” means a percentage which we add to the base rate to arrive at the tracker rate; and a “negative differential” means a percentage which we subtract from the base rate to arrive at the tracker rate.
(n) We may reduce a positive differential or increase a negative differential at our discretion by giving you not less than seven days written notice. This means that we can change the differential in a way that is favourable to you.
The above seems to indicate that they can reduce the rate in my favour, but not give them the right to increase it. Am I correct?
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Member Since June 2013 - Comments: 1121
9:24 PM, 27th April 2013, About 13 years ago
Mark I don’t know if there’s any website or landlord organisation politics going on here but neither my comment or yours have appeared. For some reason looks like they have moderated it out. Afraid of a bit of competition at the expense of their members I think
Member Since January 2011 - Comments: 12193 - Articles: 1395
9:39 PM, 27th April 2013, About 13 years ago
@Gary, I think you might be right but I hope we are both wrong. I’ve had similar issues with The GOOD Landlords Campaign and the Deed of Assurance. It seems like they don’t like anything they’ve not started whether it helps their members or not.
Member Since February 2014 - Comments: 43
9:41 PM, 27th April 2013, About 13 years ago
who are they
Member Since January 2011 - Comments: 12193 - Articles: 1395
9:46 PM, 27th April 2013, About 13 years ago
They are people making bad decisions, maybe for selfish reasons, maybe for foolish reasons, who knows?
7:45 AM, 28th April 2013, About 13 years ago
Just found out about these increases.Could someone clarify wether or not my mortgages are exempt from these increases.I took out two buy to lets with Bristol and West in July/August 2007 and they were transferred to Bank of Ireland.
I am away from home at present so I am unable to check my mail to see if I have recieved any nasty letters from Bank of Ireland. Keith
Member Since July 2013 - Comments: 41
8:12 AM, 28th April 2013, About 13 years ago
Dear Mark,
1. Please can you help regards the class action? I originally complained to BOI and FSA and after their response I then escalated it to the Ombudsman on 22/03/13. On page 8 of the leaflet that the Ombudsman provided it says ‘We will not usually handle a complaint that has already been considered by a court (or were court action is due to take place). My question is if by supporting the class action my case with the Ombudsman could be stopped? If this is the case I am still happy to donate anonymously.
2. I have found interesting the BOI sent me a letter 5th April 2013 showing the new increased payment for the affected mortgages but I also have a number mortgages which are not apparently effected by the increase and are due to come off their fixed rate in May and revert to tracker rates but I have not been advised their new payment amount.
Regards Lee
9:39 AM, 28th April 2013, About 13 years ago
Hi Is,nt it just a technical glitch. ?
Member Since June 2013 - Comments: 1121
9:49 AM, 28th April 2013, About 13 years ago
Jackie if both Mark and my comments have been moderated out its more than a glitch.
9:56 AM, 28th April 2013, About 13 years ago
Gary sorry blonde moment did,nt realise it appeared on here then got removed I had,nt seen it at the time
Member Since January 2011 - Comments: 12193 - Articles: 1395
11:08 AM, 28th April 2013, About 13 years ago
@Keith Johnson – good news, your mortgages are not affected, for now! Only some mortgages taken out before Oct 31st 2004