Bank of ireland Tracker mover product - 5 year limit scrapped!

Annemarie123

Registered User
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I rang BOI and was told that the tracker mover is no longer just for 5 years but is now for the lifetime of the mortage. I was suprised as i had expected to see such a move in the news headlines or even discussed online and I can’t find any sign of it. Does anyone know anything here?
 
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Brendan Burgess

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Hi Annemarie

That is news to me, but it looks as if it's true:

https://personalbanking.bankofireland.com/borrow/mortgages/mover/starter-tracker-for-mover/

If you choose a Tracker for Movers, the interest rate will change in line with the European Central Bank (ECB) Repo rate until the date when the tracker mortgage loan you have now would have been paid off if you’d kept it for its full term, i.e. until the “tracker end date”.


You can have a term for your new loan that ends after the tracker end date, for example, to match the term for any additional borrowing to buy your new home. After the tracker end date, any amount you still owe us will be charged interest at the prevailing Bank of Ireland variable rate for home loans (or we may offer you other rate options at that point).


Brendan
 

Annemarie123

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I saw that too on their page. Just thought there would be some hype about it. I only radomly asked them on the phone on the off chance. This i think means a major change of plans for us. Now i think it makes more sense to sell our 3 bed semi starter home to finance our trading up family home. We have 175,000 left at ecb+1 on the 3 bed semi and we need 300,000 in total to build the new house.
 

Brendan Burgess

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It makes sense for BoI to do this.

They will be getting 2% on your €175,000 which is still above the eurozone average. So it's very profitable for them.

And they will be getting far more on any additional amount you want to borrow.

Brendan
 

Delboy

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1,559
ARRRGGHHHH :mad:
I moved house 2 years ago and so am under the 5yr rule i.e. my tracker +1% will be gone in 3yrs.

I'm going to contact them today via the mortgage lad in my local branch and see if anything can be done. Will report back
 

Annemarie123

Registered User
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With our 175 at the 2.1 tracker mover and the other 125 at fixed/ variable etc am i basically tied to bank of Ireland with no option to switch ever.
 
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Brendan Burgess

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No, you are not tied to BoI at all. You can switch to any other bank who will take you. You will just pay the market interest rate on the full amount.

Brendan
 

Brendan Burgess

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I moved house 2 years ago and so am under the 5yr rule i.e. my tracker +1% will be gone in 3yrs.
Hi Delboy

Good news! You can keep your tracker for its full term.

Charlie Weston picked up on this story yesterday and BoI has confirmed to him that those who have moved who were subject to a 5 year limit, will no longer be subject to that limit.

Bank breaks 'tracker mortgage trap' by allowing movers keep cheap rates on new homes

Head of mortgages at Bank of Ireland Shane Quinlan said: “Tracker for Mover is a tracker interest rate for homeowners who have a Bank of Ireland mortgage loan with a tracker interest rate and want to move home.

....
And the change will apply to those who have already moved home with a tracker.


“The product applies to existing Bank of Ireland tracker customers, and Bank of Ireland tracker customers who moved their tracker when the five-year limit applied,” he added.
 

Delboy

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That's like a small lotto win! Brilliant news.
Means I get to keep my tracker +1% for another 10 odd years after the 5 years are up. That's a 1.5% differential based on current rate comparisons.

I'll celebrate this one!
 

dragonboy

Registered User
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15
Hi Delboy, I am in very same situation as you we moved 3 yrs ago and only have 2 yey left , so initially was delighted with the news however after all that's happened I don't trust the banks they give nothing away for free, I am playing devils advocate here but as the irish Banks have some of the highest variable rates in Europe and they are under pressure to bring them in line with other european countries could there be a situation where the variable rate is similar if not equal to the ECB rate and therefore we are losing out by then paying ECB /tracker rate plus 1% rather than just the variable rate.. just a thought as I said they give nothing away for free...
 

RedOnion

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@dragonboy
Just another take on this. Your tracker rate will be quaranteed as a margin above ECB. Even if the variable rate drops below that (extremely unlikely in short term), it will not be guaranteed to stay lower.

Also, there is nothing to stop you giving up your tracker at any stage to switch to a fixed or standard variable rate if they are better.

Banks aren't giving you something for free. Allowing mover trackers makes lots of sense to them financially. On average movers increase their mortgage by about 1/3, which is at a higher rate. Plus they add 1% to the rate. So they make more money.
But most importantly, the quality of the loan is better. People are far less likely to go into arrears on a mortgage when they actually want to stay in the house.

BoI were the last to offer this extended term. Imagine the bad press they'd get if they started offering it now, but didn't include those that already availed of it?
 

dragonboy

Registered User
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15
Fair enough.. ah the legacy of how the recession has made us paronoid, we moved our tracker 3yrs ago but did not increase our borrowings
 

Delboy

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I still haven't had confirmation of this change from my branch whom I contacted last week. But it looks like a done deal based on The Indo's article and I'm not expecting any nasty surprises.
 

peemac

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630
Hi Delboy, I am in very same situation as you we moved 3 yrs ago and only have 2 yey left , so initially was delighted with the news however after all that's happened I don't trust the banks they give nothing away for free, I am playing devils advocate here but as the irish Banks have some of the highest variable rates in Europe and they are under pressure to bring them in line with other european countries could there be a situation where the variable rate is similar if not equal to the ECB rate and therefore we are losing out by then paying ECB /tracker rate plus 1% rather than just the variable rate.. just a thought as I said they give nothing away for free...
For Irish rates to come to anywhere near european averages you would need to allow the banks repossess properties from non payers in the same way as the european countries that everyone compares rates with. In other words, the banks would be able to have repossession completed within 6-9 months of default - rather that the current 6-9 years and after several costly court cases that seems to operate in Ireland.

And the chances of the political establishment permitting that is zero. Hence the chances of variable rates being at or near european averages is zero.
 

Delboy

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1,559
Confirmation received from BoI that when the current 5yr period is up, I'll receive a list of rate options. 1 of them will be to keep the tracker +1% for the remainder of the original term.
I'm off to The Shelbourne for lunch :D
 

todo

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264
Confirmation received from BoI that when the current 5yr period is up, I'll receive a list of rate options. 1 of them will be to keep the tracker +1% for the remainder of the original term.
I'm off to The Shelbourne for lunch :D
Make sure you get that in writing.
It sounds like sometime they've promised in the past but not lived up to, thats why we are here.
 
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