AIB AIB restoring my tracker - but at 3.67%!

Sarenco said:

Thanks Balfour.

So, the condition provides that in the absence of any election on your part you default to a variable rate at the end of the fixed rate period. The condition doesn't actually say that AIB must notify you of your options at or prior to the expiry of your fixed rate period but AIB seem to be accepting that as implicit in the way the condition is drafted – which is certainly good news from your perspective.

Where it gets interesting is the definition as to what constitute AIB's "prevailing rates" for the purposes of this condition – "…prevailing rates means the interest rates then current and available at the date that a customer's fixed rate period expires".

If you fixed in 2008, I assume that trackers were no longer generally offered to new customers by AIB by the time your fixed rate period expired. So what was the tracker interest rate "then current and available" at the time your fixed rate period expired?

I would argue that in this context it must mean either: (i) the average margin over the ECB refi rate charged on the existing AIB tracker book at the time that your fixed rate period expired; or (ii) the average margin over the ECB refi rate that was widely marketed or offered to new customers immediately prior to the withdrawal of this product by AIB.

I can't see any contractual basis for AIB simply pulling a tracker margin from thin air on the basis of their own assessment of the market today or determining a tracker margin by reference to their current SVR.

If I was in your position I would reject this offer and, if necessary, appeal to the FSO (copying your complaint to the Central Bank).

Hope that helps.

Click to expand...