Ulster Bank/First Active Offset mortgages, here's the answer to previous thread!

kenif

It works out with mine. Also works out at about 4% with all the working examples they gave in press release. It's about. If you put your loan/facility as of 31st of August, remaining term and 4% into a interest calculator you will get fairly close to their offer. If you qualify for the max through doubling or whatever. But if you only slightly offset then I think you put in your offset amount instead of loan and double it to get close.

Uatstau

https://www.boards.ie/discussion/comment/121432824#Comment_121432824

This for me is the critical issue. I fear it is taxable. Note they do not call this 'compensation' even though that is effectively what it is. It is an 'ex-gratis payment'. Payment = income = tax. I'd love to be told I'm wrong but I suspect you have to pay tax, which means you only get about half of it. That changes the situation completely. I would be happy with the payment offered if it was tax-free, but not if it isn't. (Note that by having money in the tied account I effectively get the mortgage rate as interest and don't pay additional tax as you would with DIRT in a savings account. Now that benefit will disappear PLUS you probably get hit for tax).

Clarification would be welcome but, of course, don't expect that from Ulsterbank who in the FAQs tell you to 'talk to your tax advisor'.... like I have one... I just PAYE.

kenif

https://www.boards.ie/discussion/comment/121433994#Comment_121433994

What percentage of people have told banks that they didn't want their performing loans sold to a vulture fund. Didn't stop them. I have looked at the T n C on their website but not being a finance or legal person I can't say if they are right or not. Pulling accounts is mentioned though. It is dated Apr 23... How does it stack up to your original booklet? Anyone got that to check the sections they reference.

fliball123

https://www.boards.ie/discussion/comment/121434029#Comment_121434029

If it is taxable I wonder if by just putting the amount off the mortgage amount would avoid taxation. I know that when you sell a house and then buy one your not liable for tax on the profit made on the selling of the house providing it is used for buying the new house.

fliball123

https://www.boards.ie/discussion/comment/121434098#Comment_121434098

Yes but the vulture funds have to adhere to the terms and conditions and a condition in most mortgages is that the bank can sell the mortgage but that the entity buying must adhere to all terms and conditions. its usually when someone's mortgage interest rate increases or/and they default that we hear about how bad the vultures are but those who continue doing what they were previously as in paying away are doing fine. This will be Ulster bank actively breaking the contract by reneging on one of its fundamental conditions and one that made people go for one of these types of mortgages and there will be no where for them to run other than paying another massive fine to the regulator if they try to force this through without due diligence and ponying up the appropriate compensation for breaking the contract

paneur

Hi ..

Never posted before , anywhere , but this has annoyed me so much I feel I must...

I understood terms and conditions could not be changed when loan books were sold...

Does anybody on here have any legal knowledge if this is correct...??

The lead time up to this is just ridiculous . For over a year their advice was to "Do Nothing " until they contacted us. Now they are intending to wrap this up with no consultation whatsoever by early next year. We will give you a lump sum and a good bye letter. No even mention of new provider. Just not good enough...

Several people have mentioned grouping together to challenge this. I am more than willing to take part , but how can we actually make contact with each other .??

fliball123

https://www.boards.ie/discussion/comment/121434920#Comment_121434920

Well as I suggested get a poll going and anyone in the group that is unsatisfied we could get names and start a facebook/X/Whatsapp group and get people to go in there and then construct a letter to Ulster bank warning of legal action that will be coming from this group if they don't come to the table and if they are not willing then its time to go legal.

paneur

https://www.boards.ie/discussion/comment/121435063#Comment_121435063

I fully agree.. As I said this is my first time posting . I assume we can't just post details and phone numbers , so any idea how we can make contact to maybe form a watsapp??

TheAngryTechie

Hi, new on here.

i asked for the offset mortgage terms and conditions over a yr ago, got nothing. Asked again and eventually UB sent me a page of general conditions for my mortgage. Called them & complained that this wasn’t the terms but heard nothing back from them. That was months ago.

Today, got the letter with the UB offset t&c, I have never seen this booklet until today!

letter says they can remove the offset account due to section x of condition y, it’s all very suspect imo.

fliball123

https://www.boards.ie/discussion/comment/121435181#Comment_121435181

They will have to prove this from the original deal with First Active and I am sure that the phrase the offset facility account would be available for the duration of the mortgage was used. They need to show the original docs from what we all signed back with first active. If they cant show that then they have changed the term/condition without consultation.

kenif

Maybe don't wait till you have the group formed.

Give MABS 0818072000 a call. They are more debt service but are free of charge. N must have experience dealing with problem Mortgages and even contract disputes.

See what they think and people can join the group if there is traction or a case.

phormium

MABS will have no role in this I would think, it's not about arrears/debt management or budgeting issues unless one is also in that boat.

I have the original T&C booklet and will have a look tomorrow for comparable paragraphs, the ones issued with letter are obviously reprints as the originals are A4 sized but then they would hardly have thousands of originals hanging around!

fliball123

https://www.boards.ie/discussion/comment/121435181#Comment_121435181

There is no way they could of do this without breaking the contract as they would of done it years ago

fliball123

https://www.boards.ie/discussion/comment/121435280#Comment_121435280

Do you have the one from First Active, if you do it would be great if you could scan it and/or attach it on here for all to read?

aodhan2

I received the same letter and called them today . Got nowhere really and was advised to get financial or legal advice . I would be interested in seeing what others are doing

preda

fliball123 we have about 50k left and have had the mortgage fully offset paying no interest for a few years. For the last 3 months UB said we saved 672 in interest. (which was the most we've saved per quarter because interest rates are so high now) That's about 2600 per year if rates don't go up again. (predicted no possibility to go down until 2025). Yet they have calculated we will only save 3500 for rest of the almost 5 year mortgage!! They doubled this to 7000 as "goodwill". Doesn't come close to the interest we will actually have to pay or compensate for having to find hundreds extra per month and how that will affect our lives. I have phoned the helpline and a specialist is to call me back within 3 days. I am asking for a copy my mortgage history record, a formal written response to my disagreement of their offer and for a new offer to be made. I require this to open a case with the financial ombudsman, go to a solicitor and a mortgage advisor.

DB2023

https://www.boards.ie/discussion/comment/121435425#Comment_121435425

Why would you have to pay interest if you have the mortgage fully offset? The money currently offsetting yoir mortgage can be moved to continue offsetting your mortgage I believe.? And the rate will still be the same tracker rate regardless of who takes over?

kenif

50k at 5.65% for 5 years the maximum amount of interest you would pay is 7,500. If it's a couple of months out or a couple of thousand on loan that figure would change a bit.

They are not using the 5.65 as they predict it to come down so it seems you have maxed out.

phormium

https://www.boards.ie/discussion/comment/121435340#Comment_121435340

Not in a position to scan it at the moment, it's a fine big booklet! Read a few relevant sections and will attach (bad) pics from phone but from my reading it's kind of saying they can change what they like when they like! Remember we had free banking too on the current account but they took that away years ago as well.

FA.jpg

fa1.jpg

Fa2.jpg

phormium

https://www.boards.ie/discussion/comment/121435495#Comment_121435495

That's not entirely clear to me, I initially understood from my reading of the 'pay and redraw' bit that you could just lodge your lump sum funds into the mortgage and continue to save interest but then they say that it cannot exceed your facility limit. If one presently has an available facility of say 10k and lodges 20k directly to the mortgage does the available facility then change to 30k or is it still 10k of available facility and a credit balance of 20k on account. If it's the 30k AF then that's fine, it's like a basic sort of offset account but it would need managing to keep an eye on the natural reducing of the AF amount and to ensure the credit amount doesn't exceed the mortgage balance.

I'd ring and ask for clarification of that point except it doesn't apply to my mortgage as I only have about 18mts left and small balance.

Jim2007

https://www.boards.ie/discussion/comment/121435307#Comment_121435307

This is a situation where an Irish Bank is being wound down, it is not the case of an ongoing business so be very careful about statements like this as once UB is placed in liquidation as part of the wind down the rules change. Seek proper legal advice and do not rely on opinions offered here.

TheAngryTechie

well maybe they tried to sell it off so they wouldn’t have to pay us but they couldn’t

these t&c’s haven’t existed until today, I’m certain of that. Has anyone on here received a copy of these t&cs since UB took over these mortgages and if so how do they compare to todays t&cs?

phormium

https://www.boards.ie/discussion/comment/121435590#Comment_121435590

What they have sent today is a Notice of Variation of the T&C so we never got that booklet as such before, it refers back to sections of the original booklet and I have found most sections mentioned in the original but will look better tomorrow for the ones I can't find.

aoraki

If you look at this thread over on askaboutmoney, somebody attached some terms and conditions when this was with First Active https://www.askaboutmoney.com/threads/how-will-first-active-offset-mortgages-be-impacted-by-the-withdrawal-of-ulster-bank.222580/page-2

Silpac

I'll be very keen to hear what your offered. I've v similar numbers, totally covering mortgage with offset.

I got offered 12.5k

I see someone saying they were offered 90k. I don't see that as remotely credible.

Most calculations here are forgetting the opportunity cost of your savings. If you 100k off setting your mortgage yes it's a big saving but they also assuming you will now be earning 4% income on this now that you otherwise would not have had.

Nobody is going to be compensated for the gross figure.

TheAngryTechie

When you say ‘original booklet’ you mean UB booklet?

i never received this from them and asked for it in Jan 22 but they never sent it to me, only saw it today

i have seen the original FA t&cs

Silpac

https://www.boards.ie/discussion/comment/121432824#Comment_121432824

Hmm not really. In fact t the saving you made on your offset is technically taxable.

phormium

https://www.boards.ie/discussion/comment/121435627#Comment_121435627

Is there an UB original? This was a First Active product so assume the original FA booklet is all that is available, nothing changed with it when they merged, well other than them putting charges on the current account over past few years!

Silpac

CB have approved this approach. Done deal. I agree ref the opportunity to improve offers but this is a decent offer all round.

kenif

https://www.boards.ie/discussion/comment/121435624#Comment_121435624

They got offered 90K on a 200K mortgage, 100K offset and 15 years left. Great offer but so large because the benefit they are missing out on is greater than most.... But this change could cost them more than 90K with 15 years left and no offset.

Silpac

I can't understand that... don't see how it would ever , ever, ever cost them 90k !

And they can still set off the 100k against the 200k. Just not in a separate deposit account .

preda

https://www.boards.ie/discussion/comment/121435495#Comment_121435495

No you can't straight offset now. I would have to pay it into their pay and withdraw option but you can only withdraw under certain terms and conditions so it basically becomes theirs and not yours anymore. You lose the the same access to your money the offset gave you and if you do have to take money out then obviously you are paying the interest again.

Silpac

Fair point, good clarification.

TheAngryTechie

The t&c booklet received today refers to ‘What it currently says’ and ‘What it is changing to’ so UB are implying that there is/was an original UB booklet and this new one is making changes

i never received the original and in Jan 22 they couldn’t send me a copy of this booklet, did anybody on here receive this?

DB2023

https://www.boards.ie/discussion/comment/121435659#Comment_121435659

If they have 100k currently offset and get 90k from offer. That's a mortgage balance now of 10k. How's that going to cost them more then 90k over the 15 years ? What am I missing?

TheBaldyBuddha

https://www.boards.ie/discussion/comment/121435280#Comment_121435280

Original FA one ??

preda

https://www.boards.ie/discussion/comment/121435512#Comment_121435512

They said they would be doubling your interest payments as goodwill. They have offered 3500 doubled to 7000. I should be getting 15000 approx. This is needed because rates are not coming down until 2025 according to experts. Anything could happen in the space of 5 years. Europe is a tad volatile at the moment. I was fully protected against that with the offset mortgage.

kenif

https://www.boards.ie/discussion/comment/121435745#Comment_121435745

If they use 190K to pay down they have a balance of 10K. If the opt to keep 200K mortgage it's a guess how much that will cost them over 15years with moving interest rates.

Silpac

You also have a loan agreement.

kenif

https://www.boards.ie/discussion/comment/121435765#Comment_121435765

Sorry but they will double, but not exceed what they would expect you to pay over the term of the mortgage.

They are calculating that your mortgage will cost you a total of 7k till it's end after offsetting ends. They won't pay above that figure.

phormium

https://www.boards.ie/discussion/comment/121435754#Comment_121435754

yes FA one

preda

https://www.boards.ie/discussion/comment/121435786#Comment_121435786

I currently save about 2500 per year and I have 5 years left. They have calculated that for the entire remaining 5 years I will only save 3500 in total?? And that is the issue.

"To calculate your goodwill payment, we have considered how you used your Offest Arrangement in the past and what you may have saved in the future mortgage interest ................. We acknowledge that future offestting balance could increase and ............. To take account of this, we have doubled the payment to you...."

So they will be giving you more than the exact interest rate calculation or they should be.

kenif

https://www.boards.ie/discussion/comment/121435900#Comment_121435900

Mortgages.ie have a capital mortgage calculator. Put your figures in there but with 4% interest.... Remember the interest you save yearly goes down greatly as your loan goes down.

DB2023

If you are lucky with the duration left on your mortgage and used offsetting, you could be a huge winner in this. Others not as lucky. But everyone with one of these mortgages has done well over the years. The rates were great until very recently. And if you had the means to use the offset it was a dream product for the customer. I despair of the people now complaining about their offer of 5k who are saying they had savings separate to the mortgage as they didn't realise how it worked... Still to see my offer but I'll be fighting it until they compensate for the huge loss of the remortgage offer we all had (ie. new mortgage on the same terms. )

paul321123

I have been fully offsetting for over 10years now which means I have not paid any interest for that period,, my mortage is what I consider low and they have offered me 45% of what is left on my mortgage, not sure of the tax implications of this but all in all I have done OK out of this and will be paying down my mortgage when this comes through, still don't know how they calculated this figure, but seems the longer you were offsetting the more you got due to the savings you were making.

kenif

How long have you left on your term Paul. That's more how the calculate the 45%.

fliball123

https://www.boards.ie/discussion/comment/121435584#Comment_121435584

Yet they still have a legal obligation to their customers they say they can change it for no good reason - they cant if they could they would of done it years ago and saved a fortune and lets be clear Ulster bank is under the umbrella of a bigger banking structure RBS in the UK and they are not winding down any time soon.

fliball123

https://www.boards.ie/discussion/comment/121435632#Comment_121435632

No its not as its only a saving on the interest that could of been paid.

fliball123

https://www.boards.ie/discussion/comment/121435679#Comment_121435679

Remember they are doubling the amount that they are set to lose out on so my reading is that they would of saved 45k over 15 years on a 200k mortgage at 4% is actually fairly accurate when putting the figures into a mortgage curve payment calculator.

fliball123

Here is the original from First Active, I dont remember Ulster ever changing this. I could be wrong but just so everyone has a copy.

Offset_Banking_Terms_and_Conditions.pdf