Hello,
I think our Regulator messed up, when permitting historic lenders to exit the marketplace, or allowing loan books to be sold to non lending institutions. No provision was made for those performing customers, who had homeloans and might want to top up in the future, when it comes to former customers of Banks like Bank of Scotland, Danske Bank etc.
Am I correct in thinking that if I am an existing AIB, BoI, UB, KBC, PTSB customer with a performing Tracker Mortgage, that I can apply for a top up mortgage with that same lending institution, and not immediately lose my Tracker rate (assuming I'm approved for the new facility) ? In some shape or form, I believe the answer is yes.
If I am an existing former Bank of Scotland, Danske Bank customer etc. with a performing Tracker Mortgage and require a top up mortgage, then I am forced to go to a new lender to get my top up loan, and by extension, I am forced to immediately lose my Tracker because I have to move to a new Bank. This is not treating customers of the former banks fairly, actually puts them at a disadvantage to their counterparts who are with Banks still lending in Ireland, and falls on the Regulator for having let those customers down badly, in my view.
I find it very interesting to read some of the comments above about why a lender should or should not be providing, or offering to refinance Trackers. Sure, there's a minimum cost of capital to be covered, an overhead and profit to be obtained above that cost of capital, but it's no secret that homeloan rates in Ireland are too high, higher than in the large majority of the EU, and at this stage it's not about needing to meet minimum capital levels for Irish Banks, it's simply about profiteering.
As a brief aside, the Irish State owns a sizeable part of the Irish Banking system, and by extension, the total Irish homeloan book. So, has the Government a conflict of interest between seeing Banks maximising profits to make them appear more attractive and help the Irish State get the maximum price when selling them (or calling for dividends as a shareholder), versus seeing the consumer treated fairly ? I think the answer is a very short YES and the Regulator knows this only too well, but seems happy to play along. Simply put, it's screw the individual customers in the hopes of doing right by the State in the longer term.