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.
___________________________________________
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 January 2011 - Comments: 12193 - Articles: 1395
7:22 PM, 29th April 2013, About 13 years ago
@Brian Milliagan – ahaa – I thought you might. The difficulty might be stopping them! LOL
7:53 PM, 29th April 2013, About 13 years ago
Hi iv,e got email for signing up, but it states the baristers opinion is on certain types of mortgage accounts. ( which I read as lifetime trackers) also I would like to no if the £120 is for per mortgage.
Member Since January 2011 - Comments: 12193 - Articles: 1395
8:00 PM, 29th April 2013, About 13 years ago
@Jackie, the payment of £120 represents a contribution of £100 plus VAT. That is per affected borrower(s) which are party to a mortgage(s), not per mortgage.
If a mortgage is/was fixed and then reverts to a Lifetime Tracker rate that is what is meant by a Lifetime Tracker rate as well as a mortgage which was a Lifetime Tracker Rate from the outset or or possibly a Lifetime Tracker rate which was discounted for a certain period.
Member Since January 2011 - Comments: 12193 - Articles: 1395
10:31 PM, 29th April 2013, About 13 years ago
Dear Friends,
I just created the petition “Bank of Ireland – DO NOT change interest differentials on Tracker Mortgages” and wanted to ask if you could add your name too.
This campaign means a lot to me and the more support we can get behind it, the better chance we have of succeeding. You can read more and sign the petition here:
http://you.38degrees.org.uk/petitions/bank-of-ireland-do-not-change-interest-differentials-on-tracker-mortgages
Thank you!
Mark
P.S. Can you also take a moment to share the petition with others? It’s really easy – all you need to do is share this link on Facebook or Twitter:
http://you.38degrees.org.uk/petitions/bank-of-ireland-do-not-change-interest-differentials-on-tracker-mortgages
Member Since July 2013 - Comments: 41
7:42 AM, 30th April 2013, About 13 years ago
Hi guys, read this article this morning, seems we have Which on our side !!
http://www.mortgageintroducer.com/mortgages/246339/5/Industry_in_depth/Which?_calls_on_BoI_to_%93do_the_right_thing%94.htm
9:09 AM, 30th April 2013, About 13 years ago
I would be willing to sign the petition but as I live overseas I do not have a postcode.
Member Since July 2013 - Comments: 264
3:09 PM, 30th April 2013, About 13 years ago
Justin Selig
You stated on an earlier thead that it would be best for us to write to the Bank to allow them to increase payments without prejudice to a proposed claim against them.
Would it therefore be possible for a draft letter for us to send of ?
10:07 PM, 30th April 2013, About 13 years ago
Just read the Which article, its a usefull comment by a reputable organisation. Not sure of exact time line as both articles dated 30th April but there is also a sub link “Bank of Ireland hits back at Which? ” so it would seem BOI might what to take it as far as possible, regardless of the bad publicity.
Member Since June 2013 - Comments: 20
8:37 AM, 1st May 2013, About 13 years ago
BOI in reply to ‘Which’ article state ‘the clause (differential) was clearly referenced in the pre sale offer document provided to the customer’
Just emailed our pre sale document to the law dept, absolutely no mention of ‘differential’ at all. Today BOI commenced theft by doubling our mortgage payment.
We can not allow BOI to get away with this.
Member Since February 2014 - Comments: 43
8:42 AM, 1st May 2013, About 13 years ago
there’s a piece in the daily express today just quoting the wich article really but at least its getting to a wider audience , my first 2 payments have come out today up 130%.