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

Discussion in 'Tracker mortgages - other than redress issues' started by Annemarie123, 7 Jun 2018.

  1. Annemarie123

    Annemarie123 Registered User

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    Last edited: 7 Jun 2018
    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?
     
    Last edited: 7 Jun 2018
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  2. Brendan Burgess

    Brendan Burgess Founder

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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
     
  3. Annemarie123

    Annemarie123 Registered User

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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.
     
  4. Brendan Burgess

    Brendan Burgess Founder

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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
     
  5. luckystar

    luckystar Frequent Poster

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  6. Delboy

    Delboy Frequent Poster

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    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
     
  7. Brendan Burgess

    Brendan Burgess Founder

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    If you had followed the Posting Guidelines and not just posted a link without comment, it would have been noticed by a few more people.

    Brendan
     
  8. Brendan Burgess

    Brendan Burgess Founder

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    I would expect them to extend it to the people who have already availed of it. But they are under no obligation to do so.

    Brendan
     
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  9. Annemarie123

    Annemarie123 Registered User

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    Last edited: 8 Jun 2018
    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.
     
    Last edited: 8 Jun 2018
  10. Brendan Burgess

    Brendan Burgess Founder

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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
     
  11. Brendan Burgess

    Brendan Burgess Founder

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    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.
     
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  12. Delboy

    Delboy Frequent Poster

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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!
     
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  13. dragonboy

    dragonboy Registered User

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    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...
     
  14. RedOnion

    RedOnion Frequent Poster

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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?
     
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  15. dragonboy

    dragonboy Registered User

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    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
     
  16. Delboy

    Delboy Frequent Poster

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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.
     
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  17. cullenswood

    cullenswood Frequent Poster

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    I have email confirmation from BOI that all 5 year ported tracker loans will fall under this initiative and have the option of the tracker for the life of the loan.
     
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  18. peemac

    peemac Frequent Poster

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    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.
     
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  19. Delboy

    Delboy Frequent Poster

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    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
     
  20. todo

    todo Frequent Poster

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    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.