I’ll try and stay on topic so my post isn’t moved for lack of relevance. As a lawyer I can tell you that AIB are being quite deliberate in their absence of communications to customers. It’s litigation risk avoidance strategy. They simply don’t want to invite litigation by admitting (expressly or implicitly) anything in writing. It’s an appalling way of doing business but their attitude is to simply say as little as possible, pay what they must and hopefully move on.
Hi Megafan. I had a longer response posted but it was deleted. In short, AIB are behaving exactly as you would expect them to. They breached their contractual obligations and are trying to minimize fallout now.Just to follow up on this, couldn't you also say there is nothing unusual in the way AIB are approaching it either? They have to act in the best interest of the business, and it is in their best interest to avoid this going to court so they have to adopt a certain strategy to limit that.
Mortgage holders documents guarantee a tracker under 3.2 but I would say 90%, maybe 99% don't have a tracker margin in our docs which is what the valuable detail is. We all might want it to be the 1.5% but it's not written into our docs by and large. AIB could have taken that to court and probably we may have ended up somewhere in the middle, maybe not even as good as the FSPO decision. I make this point re the general unaware section of the cohort, many of which just got on with life since 2008 or whatever (of course there are others with very sad and hard luck stories).
I sometimes feel here that the good in what is happening is lost by dwelling on unusual behaviour or correspondence or delays by AIB. To write down anyone's mortgage by 12%, backdating the interest fix to 2010 is incredible. If a person was to do this, it would take double the amount in taxable earnings, not to mention that being available taxable earnings that you have saved over and above your monthly costs. The interest refund isn't capped at the cheque, you have interest savings over the remainder of the mortgage on the 12%, which is worth upwards of 15% of remaining value of mortgages. You could be eligible for LTV discounts. These are amazing things, and AIB will suffer because of this, be they staff cuts, damaged morale, damaged reputation. Not withstanding what Corporate AIB stand for, there a lot of good people working in AIB that have suffered over the years since the crash.
I know this isn't a popular point but this is largely all due to a mistake by AIB by withdrawing trackers rather than increasing the margin by 2% or whatever, it would have knocked a load of people out of the cohort. I don't think it is an easy decision to take this forward the legal route until everything else is bottomed out, a lot of people will just be happy with what has happened.
(appreciate this might be off topic, I was just interested when you noted you were in the legal profession)
Hi Megafan. I had a longer response posted but it was deleted. In short, AIB are behaving exactly as you would expect them to. They breached their contractual obligations and are trying to minimize fallout now.
I think it’s from when you came off the fixed rate which crystallised the obligation to offer the tracker. But I’m no expert. That said, we will know more when the letters arrive which hopefully will shed light on the basis of calculation. Also, what would be more than helpful would be publication of the Ombudsman decision which the bank is basing its actions on.No worries @Jayom75, I replied to your reply at the time with an even longer response!
In short, I actually had a question for you, again given your background if you didn't mind or had an opinion on same as follows...
Do you think AIB may have somehow time stamped the principal reduction as of the date we all came out of our fixed rates the 1st time?
It is only that is appears that the interest refund may be based on every rate post breaking the fixed rate be that over 12/10/8 years or whatever as individual mortgages. If it was time stamped in a way, it could give cause for everyone to re-examine their interactions with the bank since in relation to their mortgages in a different light.
Like the old adage "if I knew then what I know now.." etc. Maybe there is nothing in the above, maybe there is something.
I think it’s from when you came off the fixed rate which crystallised the obligation to offer the tracker. But I’m no expert. That said, we will know more when the letters arrive which hopefully will shed light on the basis of calculation. Also, what would be more than helpful would be publication of the Ombudsman decision which the bank is basing its actions on.
Thanks. It just a bit of an anomaly really when you think about it.
Just as a personal example, we borrowed €25k in 2013 to build a (very) small extension before baby number 1 was to arrive. We were delighted to get the loan, AIB were very good to us, favourable rate, payable back over 7 years, off we went. We didn't overly struggle financially but we weren't living the high life either. Just normal.
Fast forward to 2020, AIB write down mortgage by €38K being 12% of balance as at Jan 2010. So is there a question/link between what happened this month versus what happened in 2013 since AIB have assigned a value to the service failure. The logical part of my brain thinks the above is frivolous as a point but at the same time maybe there is a question in there, I don't know how to articulate it yet though.
My main concern is that thinking in the above terms turns us into (forgive me!) almost like "ambulance chasers", which I would abhor myself for if that was the case but I don't know if AIB have created a house of cards by rolling out the decision to all.
Now as above, we were ok through the last 10 years but if you could apply the above principal to a case though where people have gone through genuine hardship and struggle, then its a whole other situation.
I am no expert though in any of this. It feels like AIB may not have gone far enough to avoid death by a thousand cuts.