0.1% increase on tracker mortgages

N

noggy1810

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Ulster Bank and First Active have increased their tracker mortgages by 0.1% in the current "credit crunch" situation. I thought all trackers "tracked" the ECB rates and if banks can just change the rates willy nilly when it suits then whats the point. Are these not just standard variable mortgages? Is the increase only for new customers?
 
I would imagine that the new margins over ECB are for new business but existing tracker holders should check their terms & conditions to be know for sure if and when a lender can alter the margin on an existing loan.
 
The terms of the loan contact decide what base rate rate the tracker rate is contractually allowed to track. Some banks have a stipulation in which they resserve the right to change the base rate to a Euribor rate in certain circumstances. You need to check the loan contract itself to clarify this.

Regards

Sean
 
.01% Increase will only apply to new business. Your tracker rate is stated in your loan agreement. I would expect the other banks to follow in this regard. The same as FA & UB were first to show prudency in relation to their 100% policy, all other banks then followed.
 
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