Discussion in 'Tracker Redress' started by Stacey Mckeogh, 19 Jul 2018.
It there not a plan to join forces, all the affected aib customers. Send a test case to high court?
Thankfully our friend is an accountant and he did it for us so we haven’t lost any more money. He just calculated roughly on how he supposed it could be done.
At the end of the day, no matter who calculates it or what the estimates are, if no one questions the banks lies then no one will even win! The independent review panel seem to be happy with what the banks are saying their prevailing rates would have been in 2010 so nothing else is relevant to them. It’s disheartening because it’s just another thing that doesn’t seem very ‘independent’ in this country.
I've done some quick calculations, from 13/5/09 to today.
Using ECB and AIB SVR rates.
The tracker margin on 13/5/09 would have had to have been less than 3% before any financial loss had been incurred.
Using May 2010 as starting point, it would have had to have been less than 3.2%.
So you need to challenge that it should have been less than 3.2% by either:
A. Challenge contract - tracker should have been the rate available at drawdown.
B. 'prevailing' rate should have been the last available tracker rate.
C. If tracker had been available at the time, it should have been less than 3% margin.
Basing it in how tracker rates compared to variable / fixed rates prior to the crash is futile. There is an acknowledgement that tracker rates should never have been less than variable rates, as the borrower was receiving a guarantee for the life of the mortgage, and there was a cost to that the banks had ignored.
In 2010, in the middle of a funding crisis, I think it would have been impossible, or prohibitively expensive, for an Irish bank to be able to secure 20 or 30 year funding at a rate guaranteed to track ECB (or even Euribor). So if challenging that angle, you need to be able to calculate what the rate should have been. So you need to look at debt / cover bonds that they issued: at what rates and for what duration.
I think it would be easy to prove that 7.9% is a made up figure, but they said that's an average. But you need to prove it should have been less than 3.2%.
CBI haven't challenged the approach, so I think it's not the independent appeals panel that should be getting criticised here.
I suspect there is a bit of cross Subsidization going on to other mortgage rates to make up for the fact existing trackers were priced low, I would not expect a company to let customers know they were paying for Company mistakes and the only way to recover is to surcharge/load there other customers and new customers ,
The surcharge would show up if the loaded new trackers so the easiest thing was to get rid of trackers,
The bottom line is if there was a new tracker in 2010 and they wanted to be fair to all they would have to change how the calculated the tracker rate to be fair on all new mortgage business,
The set out to be fair and treat all new mortgage business the same after 2010 all new mortgage Business is going to pay for they sins of the past including new trackers I suspect,
no matter what new mortgage you took out in 2010 should reflect fair loading on interest rates including trackers if they still existed,
And this exactly why the average person doesn’t stand a chance of winning this....I have no idea what you 2 just said
No, that's a separate issue that could have been addressed with higher margins.
Banks simply realised they could not tie their funding to ECB over long periods of time. That's why we're not seeing a 3% tracker product now for example - the bank is creating a synthetic derivative that has to be fair valued, and they are carrying the interest rate risk.
So the quote of 3.67% could include Bank addressing the other Issue with a higher margin,
Answer of yes or no will do as I do not want to take post off topic,
Separate names with a comma.