Bank of Ireland tracker mortgage % increase

250F

rckl88 wrote: »

Took out a S8NM-Core BTL 5.99% 3yr fixed then 1.75%+BR back in 2007.
Received an Offer of Loan and Residential Mortgage Conditions 2006 Edition 3 etc.

I cannot find any related special circumstances but in the Offer of Loan it does specify:
When we are charging you interest at a tracker rate:
-We will only change the tracker rate if base rate changes. This means we have no right to change the differential for the purposes of condition 6m of Residential Mortgage Conditions (which doesn't make sense btw)

Hopefully I'm not affected but please advise if you are in same situation and noticed something I've missed.

My BTL mortgage was on 23/5/2008, Product RE6, 5yr fixed 6.25% (so they've made shed loads off me!) then reverts to base rate + 1.75%.

There was no Key Facts documentat with my documentation but I do have the Mortgage Conditions 2008, England & Wales (Edition One).
Definitions 4, condition 10 - 'Unless we change the differential (if any) under condition 4(14), we will not change the Tracker Rate unless the Base Rate changes.

Definitions 4, condition 14 - 'We may reduce a Positive Differential (% which we add to the Base Rate) or increase a Negative Differential at our discretion by giving you written notice. This means that we can change the Differential in a way that is favourable to you'

I am planning on calling BoI tomorrow to confirm whether they don't have another sneaky clause to screw me over with, however at the moment I am hoping that I will still be able to finally enjoy a lower base + 1.75% from 31/5/13 for the life of the mortgage.

Welsh_woman

Agree with points of cs1800 absolutely. A rate rise at the whim of a lender is far more unpredictable and could have greater financial impact than a BOE rate rise - which I believe has never risen at such a rate in one jump. Therefore it is the banks responsibility to ensure this 'special condition' is fully understood and that all documents relating to it are shared with the customer, not hidden or briefly referred to in small print. In addition, it would be natural to understand that a FIXED differential tracker rate is indeed FIXED. If it isn't , then it is variable . Therefore it is misleading, unfair and not transparent to state FIXED in the terms and conditions.

according to BOI they have the rights under the 'special conditions' to raise the rates again. Surely there should be regulation to protect customers.

MAR871200

It seems to be just Bristol and West mortgages sold before 2004. Burying that clause in the T and C's is definitely unfair and as has been said should be noted in the offer.

I wonder why they have not used this clause before yesterday ? It seems amazing they can do this to existing customers but lender money out at rates of under 3% via the Post Office after being bailed out by the Irish Government.

rckl88

cs1800 wrote: »

Here is where I think the BOI may have a problem I have just read through my mortgage offer from 2003 they do indeed state that the differential can change in line with their residential clause 6(m) but it gives no mention of what that clause is and they do not mention a copy of the residential mortgage agreement being made available. So I signed and accepted a clause that I knew no details of. You could argue that I would be stupid to do that but you could also argue that B&W being a responsible lender should have made that information available. I would also contend that as it is such an important clause rather than just referring to it a 6(m) they should have included the full text in the offer. its also interesting to see that the rate was 4.5% but that is not going to stop me contending this as I think it is sharp practice.

My BTL mortgage is from 2007 and came with RESIDENTIAL conditions 2006 ed3 which i think is not much different to yours.
6m says in condition 6n...
-a "positve differential" means a percentage which we add to the BR to arrive at the ttracker rate and
-a "negative differential" means a percentage which we subtract from the BR to arrive at the tracker rate.

YEP doesn't seem applicable!

Anyhow 6n is
We may reduce a positve differential or increase a negative differential at our discretion by giving you not less than 7 days written notice. This means that we can change the differntial in a way that is favourable to YOU.

rckl88

Some things are obvious to everyone with common sense. Something like this, a lifetime tracker 1.75%+BR is as it says, and should not have underhanded conditions buried that would fundamentally change the mortgage!
It's not about being able to afford an increase or not or whether you had it good for so long etc. its simply because you signed up for what appeared to be a straight forward mortgage and financially planned around it!

rckl88

250F wrote: »

My BTL mortgage was on 23/5/2008, Product RE6, 5yr fixed 6.25% (so they've made shed loads off me!) then reverts to base rate + 1.75%.

There was no Key Facts documentat with my documentation but I do have the Mortgage Conditions 2008, England & Wales (Edition One).
Definitions 4, condition 10 - 'Unless we change the differential (if any) under condition 4(14), we will not change the Tracker Rate unless the Base Rate changes.

Definitions 4, condition 14 - 'We may reduce a Positive Differential (% which we add to the Base Rate) or increase a Negative Differential at our discretion by giving you written notice. This means that we can change the Differential in a way that is favourable to you'

I am planning on calling BoI tomorrow to confirm whether they don't have another sneaky clause to screw me over with, however at the moment I am hoping that I will still be able to finally enjoy a lower base + 1.75% from 31/5/13 for the life of the mortgage.

I think our mortgages are more or less the same in terms and conditions so please update if BoI respond.

brarus20

Just interested why all the new MSE accounts in this thread, and please don't give me the crap that you are all new to MSE. Don't fancy posting this great news with your normal accounts here hey?

Soubrette

brarus20 wrote: »

Just interested why all the new MSE accounts in this thread, and please don't give me the crap that you are all new to MSE. Don't fancy posting this great news with your normal accounts here hey?

I expect these threads show up when you google bank of ireland rate increase or something similar.

Martin Lewis is supposed to be the consumer champion so I suppose that drew some people in.

The guardian has an article today which mentions MSE.

All of the above and some other reasons too I expect. There may be some AEs but not a high probability imo.

armour

Graham_Devon wrote: »

Most lifetime products are not lifetime products. Lifetime warranties on cars are a prime example, so many twists and turns in those you need a solicitor just to figure them out. Loads of people.

You seem almost gleefull that people are being shafted (because that's what it is) by BoI.
Genuine question here;
Would you be happy if EVERY low differential tracker mortgage agreement was ripped up so that house prices would (theretically) fall?
If someone agreed to a lifetime tracker at BBE + X then that's what they should get.

ILW

rckl88 wrote: »

Some things are obvious to everyone with common sense. Something like this, a lifetime tracker 1.75%+BR is as it says, and should not have underhanded conditions buried that would fundamentally change the mortgage!
It's not about being able to afford an increase or not or whether you had it good for so long etc. its simply because you signed up for what appeared to be a straight forward mortgage and financially planned around it!

If you are running a business, you do not rely on "what appeared".