Bank of Ireland took me off Buy to Let tracker to extend interest only

[John Bay]

I believe I was forced to sell my Buy to Let properties by bank of Ireland as I would not switch from my tacker rate to a discounted variable rate. The bank would not put in writing from what variable rate the discount was and how long the discount would apply for. As I would not go along with this the bank's attitude hardened, they switched me from interest only to capital and interest repayments and eventually made me sell my properties (despite significant negative equity) into a depressed market leaving a considerable shortfall outstanding.

Are the central bank investigating these tracker related issues, I am sure i am not the only person this has happened to but I do not see any mention of this type of activity by banks being investigated in any of the news reports lately on the tracker issue.

Any feed back would be appreciated as the bank are now pursuing my family home.

 

[PFS7979]

John,

Were you being charged the correct tracker margin initially?

 

[Brendan Burgess]

Hi John


When you say that they switched you from interest only to capital and interest what did your mortgage agreement state? If it said you had an interest-only loan for the entire period and they switched you to capital and interest, then you have a good case. Although you should have refused this at the time. Depends on when it happened, it might be too late.

Brendan

 

[lukas888]

As Brendan says it depends on your contract.I presume you were interest only for a specified time otherwise it's highly unlikely they would have switched you to capital repayment.You also say they are now persuing your family home on foot of the buy to let shortfall.Is it mortgage free and is your wife/partner also liable for the shortfall.I am surprised they are going down this route as we all now know how it is almost impossible for Banks to gain anything by this procedure apart from placing a judgement on the home.

 

[John Bay]

Thank you for your input, from memory the rate was correct and I will check my paperwork with with regard the interest only period. My family home is in joint names but the debt to Bank of ireland is in my name alone and they have written to say they are going to high court to get a judgement which i assume will ultimately lead to me and my family having to sell up or be put out.

Obviously it was in bank of Irelands interest to force the sale of my buy to let properties as it allowed the balance on their unprofitable tracker be reduced by €300,000.00 and therefore reduced their losses. Yet they took little head of where the market was at, the lack of resource to repay the outstanding balance given the income generating properties were being sold and my income which they had full details of were not sufficient to repay the balance.

I will check my paperwork and come back on the detail but what I am wondering about is that no doubt there are many like me out there and the current tracker investigations etc seem very focused (and rightly so) on family homes and those that were switched from trackers to fixed/variables.

Is there an sign of the scope of tracker investigation being widened to investigate these other tracker related activities by the banks and if not should people not start asking for it now that there seems to be government support to make the banks accountable for poor decision making during the financial downturn ?

 

[lukas888]

John,as the debt on the buy to let's is yours only, the bank have zero prospect of forcing you to sell or vacate your family home.There is a precedent for this where a credit union in Cork appealed a refusal by a court to force a sale of a family home where the spouse was not party to the husband's debt.The home was jointly owned.I suspect they are trying to get you to agree some sort of payment.Why did you not agree to go on a discounted variable,it seems as if they would then have extended the interest period and you could have sold when the market had recovered.This would have left a much smaller shortfall.

 

[LS400]

Is there an sign of the scope of tracker investigation being widened to investigate these other tracker related activities by the banks and if not should people not start asking for it now that there seems to be government support to make the banks accountable for poor decision making during the financial downturn ?

Its only seen as poor decision making based on today's market recovery, had the market depressed much further and continued that way, it could have been seen a very prudent move by the bank. Nobody was to know.