KBC Did KBC put some people back on a prevailing tracker rate when no rate was mentioned in the contract

Brendan Burgess

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I know that there are lots of different threads on KBC and lots of different cohorts.

In this thread, I am not interested in discussing whether "variable" meant tracker.
Nor am I interested in whether "prevailing" meant "prevailing at the time the mortgage was drawn down" or "prevailing when the fixed rate ended".
Nor am I interested in whether the flyer should apply to everyone.

These are worthwhile discussions but I am trying to just answer one particular question.

upload_2019-3-19_11-4-30.png


I gather that where a tracker was not in the contract or letter of offer, the above was in some people's handbook.

1) Were they offered a tracker when the fixed rate ended?
2) If so what was the margin i.e. ECB +x%
3) If they were not offered a tracker at the time, were they offered a tracker "retrospectively" as part of the redress scheme?

By comparison
The ptsb contract said "at the end of the fixed rate, you will be offered the then current tracker rate" and ptsb did offer them the then current rates.

The AIB contract said "You will be offered a tracker at the then prevailing rate". But AIB did not offer these borrowers trackers as they no longer did them. Then last year, they admitted that they should have offered people trackers, but, they argue, as the rate would have been much higher than the SVR, the borrowers did not lose out.

Brendan
 
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unfortunate

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That statement was in my handbook but weren't offered a tracker. Started with fixed in 2005 for 2 years then offered variable or another fixed which we took for a year then same scenario in 2008 and fixed again for 5.
 

unfortunate

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Correct. Argued flyer with them but not handbook angle as didn't think that would have any bearing in contract terms.
 

Brendan Burgess

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I don't understand that.

The Handbook is part of the contract or very close to it.
The flyer is very much more distant.

I would have argued both but prioritised the handbook.
Brendan
 

unfortunate

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127
I didn't look at it that way you see. Contract is what is offered, I thought, not what is advertised or eluded to. Are you of the view that this is an argument?
 

unfortunate

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Yeah no issue. But does the handbook have a bearing on the contracts and what was offered.? I mean is it that similar to other institutions as you listed?
 

Brendan Burgess

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Hi unfortunate

This is my summary.

ptsb
Contract said "you will be offered a choice of fixed, SVR or tracker at the then current rate".
When the fixed rates ended, they were offered a choice. The tracker rate offered was from ECB +1.86% to ECB +3.25%

AIB
Contract said:"You will be offered a choice of fixed, sVR or tracker at the then prevailing rates"
When the fixed rate ended, options letter included SVR and fixed but no trackers.
When they were challenged at the time, AIB said we no longer do trackers so there is no prevailing rate.
March 2018 , AIB wrote to customers apologising for not offering trackers but claimed that borrowers would not have lost out.

KBC
A variety of contracts but they did not seem to refer to trackers in any shape or form. (I could be wrong?)
Some editions of the Handbook said "when the fixed rate ends you can agree another fixed rate, variable or tracker a the time"
They did not offer trackers in accordance with the Handbook and they did not apologise for not doing so.
 

Johnc6

Registered User
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34
Correct Brendan, The handbook you refer to came into play early 2007 where they say fixed, variable or tracker: the choice is yours. The earlier handbook says at end of fixed you will move to variable or fixed but it also clearly states they have 3 rates, fixed, variable and tracker. In explaining the tracker it says this is a variable rate.....Question, what is the legality here, would the 2007 handbook overtake/supercede the earlier edition from 2005 for 2005/2006 customers in 2007/ early 2008?
 
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unfortunate

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When I looked for my booklet from 2005 mortgage, they eventually sent me one...... the 2007 one as far as I can make out, with the statement referred to by Brendan. So should they have offered all rates on renewal letter as the other institutes did or should have? Does the handbook constitute part of the contract or is it just advertising literature and the contract is the contract? Or is it that a decision could have been made on mortgage based on the booklet?
 

Awareness

New Member
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4
You might be incorrect the mortgage contract with KBC state on page 12 under advisory heading 585 the most the bank can charge as a variable rate is .95% above the European Central Bank rate until mortgage is ended.
 

Brendan Burgess

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Hi Awareness

KBC had many contracts. Clearly where someone had a tracker mentioned in the contract, they have a good case.

I have edited the original post to make it clearer.

upload_2019-3-21_7-40-35.png


I gather that where a tracker was not in the contract or letter of offer, the above was in some people's handbook.

Brendan
 

Brendan Burgess

Founder
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37,446
Once again, I am trying to establish something very specific here

If you had a contract or handbook which said "At the end of the fixed rate period you will be offered a choice of fixed rate, variable rate or tracker rate".

That was not in the contract. It was in some people's handbook.

Despite it being in the handbook, KBC did not offer people the tracker choice.

And it appears that the Central Bank did not insist that they do so.

Brendan
 

Brendan Burgess

Founder
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Picture just posted is what's in our handbook.
Thanks but that is just not relevant to the question I am asking. It's crystal clear from that extract what they are saying. You are taking out a mortgage with us - would you like a fixed, a variable or a tracker rate. It is not saying anything about your options after 5 years.

Brendan
 

unfortunate

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127
Right. With you now and what you are after. I took mortgage in 2005 but the booklet I have is only a copy from KBC when requested as data pack. I have no idea if it is the 2005 one or if its from 06,07 or 08. I haven't been able to track one down from 2005 specifically.
 
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unfortunate

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I can't upload image but what it says is "When the fixed rate you chose comes to an end you can agree another fixed rate or, or you can switch to a variable rate at the time. The choice is yours." It then goes on to explain a variable rate but also a tracker rate, which it describes as a "variable rate type mortgage". Is this any use. I could pm an image if you like.
 

Daisy duke

Registered User
Messages
47
I am sure there should be at least 650 people that got trackers where no mention of a tracker rate was in the contract. These would have application dates between Nov 06 and Feb 08. The wording in the contracts will refer to the “prevailing rate line” and the wording in my handbook is as per Brendan’s post above. This cohort got trackers awarded on the back of the flier dates even though their contract terms were the same as many others who were refused. Now it would be nice to see some evidence of this...
 
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Brendan Burgess

Founder
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"When the fixed rate you chose comes to an end you can agree another fixed rate or, or you can switch to a variable rate at the time. The choice is yours."
Thanks. But that is a separate issue which is not relevant to this thread.
Again, I want to see the following
A contract or a booklet which said "you can switch to a .... or a tracker"

Brendan
 
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