Class Action Litigation BOI + Bristol and West Mortgages

Class Action Litigation BOI + Bristol and West Mortgages

21:03 PM, 5th March 2013, About 11 years ago 28

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Class Action Litigation BOI and Bristol and West Mortgages Increase DifferentialAs you have probably heard, Bank of Ireland (BOI) and Bristol and West have advised borrowers who took tracker rate mortgages with them prior to 31st October 2004 that they are increasing their margin to 4.49% over bank base rate.

Many landlords are concerned that if Bank of Ireland are allowed to get away with these changes other mortgage lenders will follow their lead.Property118 were first to reveal this breaking news and to begin taking action – see this thread where well over 200 comments have been left.

Landlord Action, a legal services firm with a strong pedigree in the Private Rented Sector have agreed to help. They have acted in more than 20,000 evictions and for over 2,000 letting agents. Since 1999 their free helpline has received over 210,000 calls. The founder of Landlord Action, Paul Shamplina, was one of the high profile contributors to Property118 in our formative stages. Justin Selig, the principal of the The Law Department which is a Law Society registered firm recently became a partner in Landlord Action and it is Justin who will be acting in this matter.

At this stage I am not aware what the “cause of action” will be but the following issues are all being considered:

  1. Mortgages were sold as a tracker at a margin over base rate which borrowers believed to be a fixed margin and which subsequent annual mortgage statements from BOI seems to have also supported
  2. Margins have not been adjusted previously and annual mortgage statements imply that the agreed margin over base will be maintained until the end of the agreed mortgage term
  3. Incentives offer by BOI to switch to another mortgage lender, offered in January this year, contained no mention of any intention to change the margin over the bank base rate charged on these mortgages
  4. Terms relied upon by the bank not meeting FSA and advertising standards principles whereby they should be clear, fair not  misleading
  5. The terms being quoted by BOI were not pointed as being of importance by brokers or solicitors to borrowers
  6. The terms being relied upon are fundamental to the contract but are not sufficiently highlighted in such a way that borrowers or even their professional advisers were able to comprehend their importance
  7. Irish Nationals are not being subjected to the increased margin
  8. Ambiguity of whether the “differential” actually applies to the tracker margin
  9. Contract terms being relied upon not being allowed post FSA regulation of mortgage lending as of October 2004

The above may not be an exhaustive list.

The comments section on the original thread will soon be closed but please feel free to continue to post your thoughts and updates in the section below this thread.

To register your interest in taking part in the class action please complete the form below and we will forward the information on to Justin Selig, the solicitor who will be dealing with this matter.


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12:39 PM, 14th March 2013, About 11 years ago

I've posted some images from the Bristol & West web site from 2004.

I'll email PDF versions over too...

John Smith

14:22 PM, 14th March 2013, About 11 years ago

In a letter to me (and presumably many others) dated 3 Sep 2010, headed "Proposed transfer of part of our banking business to a new UK subsidiary, Bank of Ireland (UK) plc" the following was stated

"How will this affect you?
.......there will be no changes in the administration of your account, or the interest rate you currently pay."

In my simple mind I interpret that to be mean no change in the interest rate (i.e. the tracker rate that was set in early 2004). I am not a lawyer so... can anyone suggest other possible interpretations?

16:06 PM, 15th March 2013, About 11 years ago

I have an affected B&W BTL +1.75% over base since 2002. Have written to BOI & logged complaint with FSO.
I reviewed my "Offer of Loan " it states state "for the purpose of the code of Mortgage Lending Practice, which we subscribe to...having downloaded "The Mortgage Code" it states........All written terms and conditions will be fair in
substance and will set out your rights and responsibilities
clearly and in plain language, with legal
and technical language used only where necessary.......clearly the clause BOI now want to invoke is unreasonable - for example where is the ceiling, could rates be set at 25% ???? it's an unreasonble clause. As for whether it's clear...of course it isn't, something like...we will charge you the agreed tracker ate until things get a bit difficult for us then we will increase it to a rate of our that's clear & would have made me think twice about taking out the loan. I have no doubt the FSO will rule against BOI & in our favour.

0:12 AM, 16th March 2013, About 11 years ago

BOI will have to pay £500 to defend every unsatisfied complainant i believe.

Mark Alexander - Founder of Property118

23:33 PM, 18th March 2013, About 11 years ago

@Roy Churchill - that's right. Several landlords who have multiple affected mortgages have made multiple complaints for this reason. Remember, even the smallest flea can drive a big dog crazy!

2:47 AM, 20th March 2013, About 11 years ago

I have noticed that most of the comments on this site are from BTL landlords. I am a BTL landlord with 3 BoI mortgages, all of which will be affected by the proposed increase. Whilst I do not generally involve my tennents in the pros & cons of the letting business, perhaps it is time to make them aware of our current plight. I estimate (conservatively) that around 20,000 tennent families will be directly affected by this increase, either by rent increases or homelessness. I do not wish to cause undue anxiety to any tennent, but I feel we may be missing an un-tapped pool of sympathetic voices on this issue.

Fed Up Landlord

9:16 AM, 20th March 2013, About 11 years ago

Richard I am a portfolio landlord and have a policy of keeping my rents under market rates by about £15-£35 a month with my long term tenants. Rent increases for me are a rarity. This rewards their loyalty and also aids their retention. I have, after much hand wringing written to them putting their rents up by £15 a month. I have explained the reasons why, putting the blame fairly and squarely at the feet of Bank of Ireland. I know this avenue is not open to residential owners and I really do feel for them with what has happened. One day these tenants may be home owners themselves and they may remember the reputation of BOI when they may be deciding on a a mortgage through the Post Office

12:29 PM, 20th March 2013, About 11 years ago

I wonder what the real cost (per £10,000) is to the BOI of supplying funds to their mortgagees.

21:21 PM, 24th March 2013, About 11 years ago

In today's Sunday Times, the Post Office whose mortgages are provided by Bank of Ireland are offering a 5 year fixed rate at 2.74%.

How can the BOI claim on one hand they need to raise more cash + cost of borrowing has increased as reasons to increase the EXISTING customers mortgages yet offer new loans at 2.74% ?

I think this blows their reasons for increasing our buy to let loans out the window.

20:38 PM, 25th March 2013, About 11 years ago

I agree, it would appear greedy bankers are still around.
Maybe its a way of raising bonus money?
Who Knows??????

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