Advice on Start Mortgage Rate Increases

T

Tomandgerry

Registered User
Messages
27
Hi all, grateful for any advice on the below please...

I have 2 loans (on same property - family home) which were sold to Start Mortgages by Ptsb, following a possession order issued on the property. Following engagement with Start, I was put on a step up arrangement for 18 months, which expired in May 2022. At that stage the arrears were capitalised and the repayment between both loans was circa €1600 per month and the repossession order was due to be vacated.

Since the rate increases the tracker loan (ECB +2.25%) has increased by €240 per month, and the Variable rate loan has increased by €230 per month, so a total of €470 per month which is not affordable. My total monthly repayment now is €2070, an increase of 30%. I have rang Start multiple times since the rates started increasing last year. Before I signed the ARA, I asked about the variable rate and whether it could increase (was 3%), I was told it was always 3%. I was told subsequently that they did not offer fixed rates. They also delayed vacating the possession order as I had indicated by my phone calls that I was struggling with the repayment amount.

I made a formal complaint in November 2022 about the rates and that the vacation order had not been vacated as per the agreement. They issued a final response to say they were not offering fixed rates. I then made a complaint to the FSPO and informed Start of same. Their solicitors wrote to me to say the vacation order was being progressed and that it is expected to be completed this month (I rang them to verify).

Have I any options here? There are no arrears on either of the loans but I am really struggling with the increased repayments. I have not heard anything yet from the FSPO, the €1600 was affordable and I felt I was working my way back, I just feel so crushed now and I'm back not sleeping at night now with the worry.

I have no other debts, and obviously would the ideal solution would be to switch but given my credit history imagine this is not possible and my LTV is approximately 90%? Also it would mean switching at a far higher rate than the 3%. I have heard mention of Local Authorities taking on these mortgages, would that be at all possible? I hope I have given all relevant information. Thanks for your attention.
 
Last edited:
@Tomandgerry

You should provide the following information so that we can give you a more informed response.

Case study - Information required for mortgage arrears and negative equity questions

Please copy and paste this post into a new thread. If you give comprehensive information, it will maximise your chances of getting comprehensive and useful results. Income details Net monthly (i.e. after tax) Income self: nature of income e.g. self-employed/public servant...
www.askaboutmoney.com

Brendan
 
Last edited:
Hi Brendan, thank you and apologies for taking a few days, we had a bereavement. Details as follows:

Income details
Net monthly €2,400, Public Servant
Income history: N/A
Net monthly €2,400, Insurance
Income history: N/A
Amount of child benefit received: N/A
Amount of Mortgage Interest Supplement received: N/A

Personal circumstances so we can calculate your reasonable living expenses
One adult family or two adult family - Two Adults
Do you need a car for work or do you use public transport? One Car and Use of Public Transport
No Children
Monthly spend on special circumstances: e.g. exceptional healthcare costs Health Average €250 per month

Home loan
Lender: Start Mortgages (2 loans on same property)
Amount outstanding: €350k
Value of home: €385k
Interest rate: Loan 1 Tracker ECB + 2.25% (currently 5.25%) / Loan 2 SVR (currently 4.95%)
Monthly repayment €2070
Amount in arrears €0

Summary of discussions and agreements with the bank e.g. ARA agreed, I was on a step up arrangement for 18 months, which expired in May 2022 and the arrears were capitalised.

Credit Union
Amount of shares €2000

Other savings and investments
Savings account €2000

Do you expect any lump sums in the medium term future?
N/A


How important is retaining the family home to you?
Which of the following best describes your situation?
I really want to keep the family home even if it means having a large mortgage and negative equity for years to come.


Any other relevant information

What is your preferred realistic outcome? I want an affordable monthly repayment, like the €1,600 agreed in the ARA.
Sorry I forgot to add this update, which might be helpful to others...

I received a phone call from Start last week. They are offering a 12 month 2% reduction on my current rates but the SVR and tracker rate will be applied in 12 months time. It will not effect the tracker. I have to complete an SFS to avail of same and it is only being offered to those with no arrears (as per the phone call I received).
 
Last edited:
Hi gerry

I am not sure that there is much you can do here.

You have a big mortgage in relation to your salary which would suggest that your mortgage is unsustainable.
However, the alternative of renting is even more unsustainable, so you must stay where you are.

You have not explained how they got a possession order against you. It is very difficult for a bank to get such an order so you must have paid nothing for years and you must not have gone to court. Paying anything at all and showing up in court is almost always enough to avoid having a possession order granted against you.

All you can do now is accept Start's offer of a 2% interest rate reduction. It kicks the can down the road but is much better than having a possession order issued against you.

Brendan
 
Brendan Burgess said:
Hi gerry

I am not sure that there is much you can do here.

You have a big mortgage in relation to your salary which would suggest that your mortgage is unsustainable.
However, the alternative of renting is even more unsustainable, so you must stay where you are.

You have not explained how they got a possession order against you. It is very difficult for a bank to get such an order so you must have paid nothing for years and you must not have gone to court. Paying anything at all and showing up in court is almost always enough to avoid having a possession order granted against you.

All you can do now is accept Start's offer of a 2% interest rate reduction. It kicks the can down the road but is much better than having a possession order issued against you.

Brendan
Click to expand...
Thank you Brendan, and you do not think the FSPO will do anything after my contact with them? Regarding the possession order I had an ongoing mental health issue, missed payments and did not engage with the bank at all, and I am not proud of that. I am now recovered (a result of something else that happened) and am feeling very well now thankfully.

Will I ever be in a position to switch lender as far as my credit history is concerned, my payments have been paid in full ever since I contacted Start initially (4 years ago). And re the big mortgage in relation to salary, my long-term salary expectations are 90k plus (expected within next 2 years).
 
You must log in or register to reply here.
Back
Top