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tracker mortgage should have been offered??

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  • 11-05-2013 9:26pm
    #1
    bungaro79
    Registered Users Posts: 1,213 ✭✭✭


    just looking through the details of our mortgage (which we took out in 2008 with aib). we started on a variable rate but changed to a two year fixed and when we came off it we weren't told we had the option of changing to a tracker. i went through the terms of the mortgage earlier today and saw this under the heading "further fixed interest rate options/choice" it states

    "at the end of any fixed interest rate period, the Customer may choose between:
    (a) a further fixed interest rate period, or
    (b) conversion to a variable interest rate Mortgage Loan, or
    (c) conversion to a tracker interest rate Mortgage Loan
    at the Bank's then prevaling rates appropriate to the mortgage loan. if the customer does not exercise this choice, then the mortgage loan will automatically convert to a variable interest rate mortgage loan."

    have i any recourse to go back and get it changed?? or if i was to start a 1 year fixed rate in 12 months time could i then be put on it??

    anyone else experience something like this??
    thanks


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    #2
    Scortho
    Closed Accounts Posts: 3,876 ✭✭✭Scortho


    bungaro79 wrote: »
    just looking through the details of our mortgage (which we took out in 2008 with aib). we started on a variable rate but changed to a two year fixed and when we came off it we weren't told we had the option of changing to a tracker. i went through the terms of the mortgage earlier today and saw this under the heading "further fixed interest rate options/choice" it states

    "at the end of any fixed interest rate period, the Customer may choose between:
    (a) a further fixed interest rate period, or
    (b) conversion to a variable interest rate Mortgage Loan, or
    (c) conversion to a tracker interest rate Mortgage Loan
    at the Bank's then prevaling rates appropriate to the mortgage loan. if the customer does not exercise this choice, then the mortgage loan will automatically convert to a variable interest rate mortgage loan."

    have i any recourse to go back and get it changed?? or if i was to start a 1 year fixed rate in 12 months time could i then be put on it??

    anyone else experience something like this??
    thanks

    Did you exercise your choice?
    I don't think you have any recourse, although I may be wrong.
    Where the issue with the trackers arose was with people who had a tracker, went fixed, and then weren't put back on the tracker, like they should have been.


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    #3
    bungaro79
    Registered Users Posts: 1,213 ✭✭✭bungaro79


    i didn't know i had the choice tbh scortho. i got the letter off them at the end of the fixed term with the upcoming rates and they were all fixed or variable so i thought that was all that was on the table


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    #4
    Scortho
    Closed Accounts Posts: 3,876 ✭✭✭Scortho


    bungaro79 wrote: »
    i didn't know i had the choice tbh scortho. i got the letter off them at the end of the fixed term with the upcoming rates and they were all fixed or variable so i thought that was all that was on the table

    You may have grounds here as your contract said that you would be offered a tracker rate after your fixed rate ended and you weren't.

    My understanding of the tracker fiasco though was for people who had trackers, went fixed and lost their trackers upon ending of the fixed rate.
    I may be wrong though.
    The fact that your contract says you were to be offered a tracker rate, may help.


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    #5
    Schnitzel Muncher
    Registered Users Posts: 349 ✭✭Schnitzel Muncher


    Scortho wrote: »
    You may have grounds here as your contract said that you would be offered a tracker rate after your fixed rate ended and you weren't. .

    Check the wording above. It says the OP may choose - doesn't say he would be offered. Big difference.

    Not the banks's fault he hadn't read the contract and kept on top of it at the time.

    He didn't exercise the option so was put onto the default option.


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    #6
    F1ngers
    Moderators, Computer Games Moderators Posts: 10,300 Mod ✭✭✭✭F1ngers


    bungaro79 wrote: »
    just looking through the details of our mortgage (which we took out in 2008 with aib). we started on a variable rate but changed to a two year fixed and when we came off it we weren't told we had the option of changing to a tracker. i went through the terms of the mortgage earlier today and saw this under the heading "further fixed interest rate options/choice" it states

    "at the end of any fixed interest rate period, the Customer may choose between:
    (a) a further fixed interest rate period, or
    (b) conversion to a variable interest rate Mortgage Loan, or
    (c) conversion to a tracker interest rate Mortgage Loan
    at the Bank's then prevaling rates appropriate to the mortgage loan. if the customer does not exercise this choice, then the mortgage loan will automatically convert to a variable interest rate mortgage loan."

    have i any recourse to go back and get it changed?? or if i was to start a 1 year fixed rate in 12 months time could i then be put on it??

    anyone else experience something like this??
    thanks

    You were told, it was in your contract.
    bungaro79 wrote: »
    i didn't know i had the choice tbh scortho.

    It was in your mortgage details.
    Are you saying you didn't read it over before signing?

    Hardly the banks fault tbf.
    bungaro79 wrote: »
    i got the letter off them at the end of the fixed term with the upcoming rates and they were all fixed or variable so i thought that was all that was on the table

    They told you the interest rates that were due, and you had a choice for fixed, variable or tracker - again, not the banks fault you didn't read your mortgage details


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    #7
    bungaro79
    Registered Users Posts: 1,213 ✭✭✭bungaro79


    "at the end of any fixed interest rate period, the Customer may choose between:
    (a) a further fixed interest rate period, or
    (b) conversion to a variable interest rate Mortgage Loan, or
    (c) conversion to a tracker interest rate Mortgage Loan
    at the Bank's then prevaling rates appropriate to the mortgage loan. if the customer does not exercise this choice, then the mortgage loan will automatically convert to a variable interest rate mortgage loan."

    so looking at the above in bold do you think if i went on a 12 month fixed rate that i should be able to go on it after that??


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    #8
    Scortho
    Closed Accounts Posts: 3,876 ✭✭✭Scortho


    Schnitzel Muncher wrote: »
    Check the wording above. It says the OP may choose - doesn't say he would be offered. Big difference.

    Not the banks's fault he hadn't read the contract and kept on top of it at the time.

    He didn't exercise the option so was put onto the default option.

    Yeah i missed that part. Could be argued that as he was told he could chose (at the time of signing for fixed) that he believed he would have been offered one.

    I've done a bit of looking up on the aam site. If at the time of fixing, he was offered the option of having a tracker, he should have been offered the tracker post fixing.

    From the nca:
    http://www.nca.ie/nca/mortage-interest-rates

    From aam:http://www.askaboutmoney.com/showthread.php?t=176743


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    #9
    Scortho
    Closed Accounts Posts: 3,876 ✭✭✭Scortho


    bungaro79 wrote: »
    "at the end of any fixed interest rate period, the Customer may choose between:
    (a) a further fixed interest rate period, or
    (b) conversion to a variable interest rate Mortgage Loan, or
    (c) conversion to a tracker interest rate Mortgage Loan
    at the Bank's then prevaling rates appropriate to the mortgage loan. if the customer does not exercise this choice, then the mortgage loan will automatically convert to a variable interest rate mortgage loan."

    so looking at the above in bold do you think if i went on a 12 month fixed rate that i should be able to go on it after that??

    When you originally went fixed, were you offered the option of going on a tracker rate.
    If not then I don't think so.
    From the nca:
    http://www.nca.ie/nca/mortage-interest-rates
    At the end of a fixed rate term, your lender will write to you and outline your options, which may include:
    moving to a standard variable rate
    fixing for another term, perhaps 1,3 or 5 years
    moving to a tracker rate - but only if this was offered to you at the time you signed up for the fixed rate. Look at the documentation your lender sent you when you signed up to a fixed rate, as this will detail what your interest rate will revert to after the fixed rate term ends. If a tracker mortgage was one of the options, then your lender must offer you the tracker rate, even if they are no longer widely available. If you do not have the documentation, contact your lender and ask for a copy.


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    #10
    bungaro79
    Registered Users Posts: 1,213 ✭✭✭bungaro79


    thanks scortho, i'm going to ring them on monday and request that as i can't find it in my documents for some reason.


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    #11
    Scortho
    Closed Accounts Posts: 3,876 ✭✭✭Scortho


    Keep us posted.
    If it was offered at the time of fixing, your best bet would be to contact someone who deals with this kind of thing.
    There's a person recommended on ask about money called padraic kissane who has successfully dealed with this. They've all been people who were on a tracker previous to going fixed. http://www.independent.ie/irish-news/bank-hands-out-300000-to-customers-over-tracker-mixup-28902102.html


    In the thread on there that I linked to, burgess said that the person who was in a similar situation to yourself wasn't eligible, however I think he misread that persons post as he had been offered a tracker.
    I wouldn't get my hopes up yet, but hey if it saves you a significant sum, there's no harm in checking it out.


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    #12
    dotsman
    Registered Users Posts: 3,636 ✭✭✭dotsman


    There is one thing to note: Not all trackers are good tracker! A good tracker is one were the margin over the ECB rate is low. When most people talk about trackers, they refer to a margin of between 0.5 and 1%, which was the standard around 2005-2007.

    As it was 2008 when you took out the loan, you are pretty close to the point where most banks began phasing out tracker rates (when the interbank rate began to diverge from the ECB rate). Prior to getting rid of them altogether, some banks just upped the margin (to as high as circa 3% if I remember correctly). If you don't have any documentation stating the margin, I'm guessing there is nothing to stop a bank offering you a tracker at a margin of, say, 5% or something (which would be far worse than a variable rate).


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    #13
    murphaph
    Registered Users Posts: 19,020 ✭✭✭✭murphaph


    I think the OP should certainly take this further. I think they MIGHT have a good case here if it went to the Ombudsman.

    If the Bank were deemed at fault for not advising of an available tracker rate (something I think they left out quite intentionally!) then the OP would be entitled to not only change to the tracker rate forthwith but also to a refund of the difference in interest paid since his fixed interest period came to an end.

    Might be better asking for advice on AAM but I would push this if it were me. Even in 2008 the tracker margins were likely better than any SVR you'll ever get IMO.


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