Can bank's take an amount of redress owed off morgage balance?

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Catwoman

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Does anyone know can the banks take a significant amount of interest overcharged in the tracker examination off your morgage balance without your consent and just offer you redress on the balance?
 
Hi Catwoman

If you were overcharged €10,000 interest, it would be something like:
€7,000 overpaid by you
€3,000 too high a mortgage balance.

So to put you back in the position, you should have been, you would get the overpayment of €7,000 back, and the balance would be reduced by €3,000.

If you were overcharged €10,000, but you were €30,000 in arrears, then the correct approach was to set the €10,000 overpayment against the balance and you would get no refund.

You will find a full explanation here:

Calculating the refund when a tracker is restored
 
If your mortgage is not in arrears will the bank give a cheque for the refund or will they automatically pay the refund of overcharged interest against the mortgage balance?
 
If you were overcharged €10,000 interest, it would be something like:
€7,000 overpaid by you
€3,000 too high a mortgage balance.
 
if the bank treated the excess interest charged as overpayment couldnt that have a higher benefit to the customers?
not at low levels of overcharge, but for those of us with high overpays and long time periods?
why is this not an option?
 
Hi tigger

I don't understand your point.

The principle is fairly simple.

Although the interest overcharged was €10,000, the person only overpaid €7,000. So that is all that they should get back in a refund.

Brendan
 
My question was this, if you overpaid your interest over a number of yrs, say 5, at a rate of €500 per month you would entitled to 30k overpayment returned but if it was treated as an overpayment on the principal for 5 yrs it's potential impact is to reduce your mortgage by 50 - 60k, isn't it?
I'd imagine the banks don't want to do this but it starts to look more fair if they do.
 
Hi Trigger, that's what they're effectively doing. As part of the redress they're calculating interest on the overcharged amount.
 
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