AIB Aib ex staff - getting €1,650 compensation

emilybee

Registered User
Messages
15
Hi

I have both a Staff mortgage and a Tracker mortgage
I contacted staff business today in relation to the staff mortgage. The advisor stated the mortgage was like the thread had mentioned a variable mortgage. He stated we were only informed of changing our rate in Jan 2009 due to BIK only.
He said we could have changed to a Tracker at any stage (when it was available) and it wasn't up to them to advise us to do that. He also stated that the Tracker rate was never lower than the staff rate of 3% during the years it was available.
He said AIB are totally correct in saying no staff mortgages at the preferential rate will be investigated.
Did you log a complaint and ask for it to be investigated?
 

Zero123

Registered User
Messages
20
Is it justifiable that they managed our accounts & then passed the onus back on us?should your account only be managed by the people who signed the contract?
Can someone clarify was this the first time a switch like this happened ?

They Just went in and switched all of us off the staff pref fixed rate, Is this allowed? Nowadays they need your signature to change a rate.
I know we were notified but I still don’t think it is correct

Was the staff rate ever previously this close to the variable rate in the past? I would think it was,how come they didn’t do this switch previously?

What is the reason for this switch in 09 all of a sudden & how come this never happened before?

I hope someone can answer these questions, might help to see why these switches never happened previously.1960-2009 is a long time to be 3%.......
 

MrCat

Registered User
Messages
14
I might be wrong but my recollection is staff were advised that if the ECB rate dropped below a certain level (maybe 3.25?), the BIK owed on a preferential rate made it more expensive for staff.
I think I remember a message coming out advising this and if you didnt want to move to the variable you had to say so..... long time ago so cant be 100% sure of that
 

Cbtrack

New Member
Messages
7
Surely If they are saying staff had the right to switch to tracker at any stage before the product was pulled then that in itself is an issue. Our contract with clause 3.2 is for the duration of the mortgage and not just until the bank decides to ‘pull’ the various options as they see fit. Nowhere in the terms & conditions does it say that we are only entitled to the various rates ‘if’ the bank decides to still offer them? Are we not entitled to the terms in our contract for the full duration of our mortgage and therefore if they say we ‘could’ have switched to tracker pre the rate being withdrawn that we should still be able to switch to it or be compensated for not being able to switch to it like every other customer in other cohorts? I strongly believe that if the customers here were not staff then there would be no question but things would be put right for the customer. Any contract ambiguity should always fall in the favour of the customer not the author. Why is this principle not being applied to staff?
 

Brendan Burgess

Founder
Messages
41,830
A non-staff customer on a variable rate was entitled to switch to a tracker while trackers were on offer. This was not a contractual entitlement. It was what AIB offered.
After October 2008, non-staff customers were not entitled to switch to trackers.

It is the exact same for staff. If you were on the preferential staff rate you could have switched to a tracker up to October 2008.

There is nothing in your contract which allows a borrower, whether a staff member or not, to switch to a tracker from a variable rate.

It has been established that AIB was wrong not to offer trackers to customers whose fixed rates ended.

However, AIB is denying that the Staff Preferential Rate was a fixed rate. They say it was a variable rate which remained static. It will be up to the Ombudsman to decide.

Brendan
 

Cbtrack

New Member
Messages
7
Thanks Brendan. I understand what you are saying about the position they are taking. Just wondering as the clause states ‘at the end of any fixed rate period’ - was this clause put in every single contract i.e Fixed and Variable rates, or only Fixed and Staff contracts? It seems odd to me to include this clause in our tcs&cs and then say well actually this didn’t apply as these terms were actually in relation to a different product I.e Fixed.
Should they not then have included the terms or options that actually applied to the product at hand i.e. changing rate options from a ‘static annuity’ as opposed to a Fixed rate if their position is that it is not fixed?

It’s just hard to believe anyone credibly denying the staff fixed rate of 3% was not a fixed rate. It was even marketed to staff as Homeflex preferential fixed rate of 3% and remained at 3% for the full lifetime of it as far as I remember from my time there.
 

Brendan Burgess

Founder
Messages
41,830
AIB based the staff preferential rate contract on their standard contract.

All customers - fixed, variable and tracker got the same contract.

But those on the Staff Preferential Rate had a few special conditions in Part 2 of the mortgage offer.

4805
 

Cbtrack

New Member
Messages
7
AIB based the staff preferential rate contract on their standard contract.

All customers - fixed, variable and tracker got the same contract.

But those on the Staff Preferential Rate had a few special conditions in Part 2 of the mortgage offer.

View attachment 4805
Thanks Brendan. It is clearly outlined here that it is a ‘Staff Preferential Fixed Home Loan’. How can this be denied when it is in black and white clearly.
 

Zero123

Registered User
Messages
20
Not all staff had the 3.2 clause in their contract. There was 2 contracts in Staff Business,

1. Letter of Sanction ( pre 2007) no clause
2. Letter of Offer ( post 2007) it has the 3.2 clause.

Also from June 2003 to December 2005 the variable rate was 3.30%, how come there wasn’t a switch of all staff from the preferential fixed rate at that point to the variable rate like 2009?

The switch was done for a reason in 2009, They are saying it was to benefit us and when you consider paying BIK the variable rate 3.25% was more beneficial to staff.
These days they say we don’t know a persons personal tax circumstances so can’t advise it is more beneficial .... how did they know in 2009?

How can they get away with saying the staff rate was not fixed? All the edits from the contracts above show that it was clearly considered a fixed rate.... in my view up until 2009 is when it all changed.
 

emilybee

Registered User
Messages
15
The latest response from Staff Business states the following; (One wonders why Static is not mentioned anywhere in our letters of offer but Fixed clearly is!!)

We did have a defined term, it was the term of our mortgage unless we left AIB !

Just because we paid BIK does not mean it was not a fixed rate ,it was a Preferential Fixed Rate which is why we paid BIK and as per Revenue Rules is a fixed rate !
20200727_100508.jpg
20200727_095701.jpg
 
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Brendan Burgess

Founder
Messages
41,830
It will be up to the Ombudsman or the High Court to decide.

Clause 3.2 is very clear:
At the end of any fixed interest rate period, the Customer may choose between:

AIB is arguing that this means "At the end of any fixed term period during which the interest rate was fixed..."

My argument in these cases is "If that is what they meant, then they should have said that in the contract".

They also had a special condition saying

4810

Why did they not say "Clause 3.2 does not apply either as this is not a fixed rate, but a variable rate where the rate will be static at 3%" ?

Brendan
 

Zero123

Registered User
Messages
20
To appeal, Staff need to address the wording on the contract.

Fixed Vs Static

The replies are just all roundabout ways of avoiding the wording, they need to say there was an error with the wording in the contract.

Point 3 above..... about it been a variable rate and saying “You” could switch in/out, not Staff Business could switch us in/out. They took control of our rate in 2009, in the contract they only say they will control it if we leave/resign.
 

ANNEOB

New Member
Messages
3
Switching staff accounts to 3.25 was also more beneficial to the bank, higher interest for them, also that rate increased and bank did not switch accounts back to 3%. Why did they not ever switch accounts to tracker when that was more beneficial
 

Brendan Burgess

Founder
Messages
41,830
Be very careful if you are making a complaint to the Ombudsman, that you don't get distracted by conspiracy theories.

1) AIB was right in 2009 to switch people en masse to the SVR. With the new BIK rules, this worked out cheaper for people on the higher rate of tax which I am guessing most were.
2) There was nothing underhand in this.
3) Employees were given a clear choice of opting out or choosing one of the fixed rates if they did not want the SVR
4) Employees could switch back to the "static" rate of 3% at any time and pay the BIK - many did so after the SVR rose
 

Brendan Burgess

Founder
Messages
41,830
Here is the AIB SVR history at the time. The SVR rate was always ECB +1.25%

  • 16th January 2008 – 5.25% - ECB rate: 4%
  • 16th July 2008 – 5.5% ECB rate: 4.25%
  • 22nd October 2008 – 5% - ECB rate 3.75%
  • 19th November 2008 – 4.5% ECB rate 3.25%
  • 17th December 2008 - 3.75% ECB rate 2.5%
  • 28th January 2009 - 3.25% ECB rate : 2%
  • 19th March 2009 - 2.75% ECB rate: 1.5%
So in July 2008, before AIB withdrew trackers, any staff member had a choice:

Staff Preferential Rate: 3%
SVR: 5.5%
Tracker 5.75%

It would have been a very prescient staff member to choose a tracker at 5.75%.

The letter of mass transfer gave staff the following options:

4813

4812


So there was no conspiracy.

While trackers were available, it would have made no sense for anyone paying a fixed rate of 3% to opt for one.

I believe that AIB staff have a good case in that Clause 3.2 applies to it.

Don't dilute that good case by distracting the Ombudsman or the High Court with a Conspiracy Theory. It will damage your credibility.

Brendan
 

ANNEOB

New Member
Messages
3
I took out my mortgage in 2000 so am I correct in thinking clause 3.2 wouldn't have been on it
 

Zero123

Registered User
Messages
20
Brendan, how come they did not do an “en masse” switch In 2003 when the SVR was 3.30%, was the BIK criteria different then?

I see your point to focus on facts, staff pref fixed rate being a fixed product as stated in the contract and including the clause for a fixed rate is the strongest & most clear argument.

Just for me... I didn’t know I was to manage my rates myself & plenty of more staff with me missed the opportunity of availing of a lower fixed rate as we thought that staff rate was the best rate. It is very frustrating to think that they never moved the rate and after 50 years decided to do this and never did it again. Hard to comprehend.
 
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