Bank or Ireland - Increase of "differential" !

BR_Landlord

Seems T & C varied.

I found my old Bristol & West 2007 Edition "Residential Mortgage Conditions"
regarding changing the differential. The booklet states:

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.


These T & C came with an additional loan but I threw out the T& C for the original mortgage. nb B of I are NOT increasing the differential for the secondary loan!

Would they have all the various T & C booklets (dated versions) and increase differentials according to different versions? how many versions are there?

BR_Landlord

Dot_Comedy wrote: »

It does seem from this thread that there are no common terms and conditions for changing the agreement and that the T&C's changed year by year. As I posted earlier my T&C's are far simpler and far less onerous than those some of you have posted, which quite frankly are ludicrous and make a mockery of a tracker mortgage as it gives the bank the opportunity to renege on the contract almost at will. In normal contractual terms this could well be considered to be 'unfair' and thus unenforceable. (Any lawyers out there?)

In my Residential Mortgage Conditions 2007 Edition One it is only 6 (n) which refers to changing differential.

BazzaNE4

Like everyone else on this thread, I was also surprised to receive a letter from Bank of Irelands increase of differential. I have had to revert back to the original correspondence received from Bristol & West (dated March 2004). My mortgage loan offer mentions the 'Base Rate Tracker Special Condition', which in turn refers to the Residential Mortgage Conditions. These conditions were not provided at the time of signing, nor did I receive a copy. I have to admit at the time Bristol & West representative apparently followed ‘the Mortgage Code’ discussing all options Fixed, Capped, Variable, Tracker, etc…and the consequences if I did not make payments. But failed to mention or have any inclination towards the ‘Residential Mortgage Conditions’. The mortgage code (apparently) provides ‘protection’ for you as a borrower. It sets out ‘minimum standards’. The mortgage code was put in place to ensure the lender explains all risks to the borrower by explaining how the mortgage system works. In this instance, I was most definitely not told or aware that the lender could increase interest rates if they so wished. The Mortgage Code was put in place to give the borrower an extra level of protection. Lenders would join schemes such as the Financial Ombudsman Service or Mortgage Code Arbitration Scheme. This was put in place to provide protection to borrowers and awarding compensation of up to £100,000 if you suffer as a result of your lender failing to keep to the code. I am no legal representative but I feel our grievances should be perused via these schemes.

smiffy

These conditions were not provided at the time of signing, nor did I receive a copy.

I don't believe that I ever saw a copy of this either, I've everything filed, and this document isn't present.

I've asked the original broker I used to see if they've kept a copy, and BofI are also sending a copy.

jozeffo

You probably can't use the Financial Ombudsman Service for a BTL mortgage as they referred to as non-regulated loans

jimfudge

smiffy wrote: »

Back in 2004 I took out a Bristol & West Base Rate tracker mortgage at .89% over the Bank of England Base Rate. In 2004 .89% was a high rate as I was self employed and had to pay a premium rate.

The deal was that that rate was for the life in the product, in my case 23yrs.

Today the Bank or Ireland letter, states that there are "Special Conditions" in the T&Cs which allow them to increase the rate. Firstly in May 2013 2.49% and then again on October 2013 to 4.49%

This will change increase my payment by over £500 a month.

Who else is in this situation?

I'm in shock at this as I've only expect my payments to creep up with the base rate over a period of time.

How can they get away with this?

I've got all my paperwork from 2004, but don't have any info on the "Special Conditions" 6(s), 6(l), 6(m) or 6(p).

Can some one advise what is in section six please.

Not sure what to do now!

I have the same problem with two B & West BTL loans. Interestingly, The Bank Of Ireland were offering me a £8500 incentive (for each mortgage) if we could discharge them by the end of March 2013. Also in 2006 I took out a further advance on both my accounts (called sub account2) and yet these are not affected by the change ? I also do not have any T's & C's from the original mortgage offer in my possession stating they can do this. I cannot this differential hike is legal and it seems to be an unreasonable jump from 1.75 - 4.49%.
They say that they are allowed to do this under "special circumstances" - what are these special circumstances ? apparently one of special circumstances is that they are now required to hold more capital reserves, but why penalise the BTL customers and surely it will take years to build up reserves with this method !
I think like PIP we should be able to fight this ?

help !!

jimfudge

I have the same problem with two B & West BTL loans. Interestingly, The Bank Of Ireland were offering me a £8500 incentive (for each mortgage) if we could discharge them by the end of March 2013. Also in 2006 I took out a further advance on both my accounts (called sub account2) and yet these are not affected by the change ? I also do not have any T's & C's from the original mortgage offer in my possession stating they can do this. I cannot this differential hike is legal and it seems to be an unreasonable jump from 1.75 - 4.49%.
They say that they are allowed to do this under "special circumstances" - what are these special circumstances ? apparently one of special circumstances is that they are now required to hold more capital reserves, but why penalise the BTL customers and surely it will take years to build up reserves with this method !
I think like PIP we should be able to fight this ?

help !!

kingstreet

jimfudge wrote: »

why penalise the BTL customers

They hiked the residential standard variable rate from 2.99% to 4.49% in two increases in June and September last year.

fawny

kingstreet wrote: »

They hiked the residential standard variable rate from 2.99% to 4.49% in two increases in June and September last year.

Hi,

Yes I have a residential mortgage with them & had my rate increased as Kingstreet says last year.

HerbertJames

I think that the key to fighting this for most people is on the basis of the loan being mis-sold.

The basis of the PPI scandal was not based around the small print in the contracts themselves. Indeed for some people, PPI was probably a good thing. The reason that the banks have suffered such penalties over PPI is that they did not make the small print known to customers at the time of purchase.

I've looked at my origin B&W paperwork and there is no mention of any possibility that the differential should change and I was certainly not told of it verbally, so on that basis the load was mis-sold to me.

I've not followed the process for PPI, but presumably the success of a claim depends on you being able to prove that you weren't fully informed at the time. How on earth do you do that?