KBC took my home loan tracker when extending interest only period

MOD

Registered User
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I got a mortgage out in 2006 on a tracker rate (0.95% above European base rate) for the full term of the mortgage. I got interest only for the first 3 years at this rate. I requested and was granted a further period of interest only but was put on SVR by the bank. My understanding was that the SVR was for the extended period of interest only on the loan...not for the remaining full term of the loan which was 15 years....I was not advised to seek independent legal or financial advice and I was unable to sit down and discuss the issue with the bank. I could only speak to them on the phone which was totally inadequate....also some of the terms used were difficult to understand..i.e..."on an execution only basis" etc. The Ombudsman ruled in favour of the bank but I am taking it to court. I wonder if anybody else has a similar experience? Most of the tracker debates have been about reverting to tracker from fixed rates but nobody has mentioned return to tracker from interest only...I would welcome any views on the matter. Thank you in advance.
 

peteb

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1,648
You could have been interest only on a tracker - it isn't a rate type per se. But you accepted a standard variable rate to get it. That is why there is no talk of "returning from tracker to interest only".
 

MOD

Registered User
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I was on interest only on a tracker rate and had it extended....I'm not talking about "returning from tracker to interest only"...I'm saying the opposite...."returning from interest only to tracker"....Is it not the same as other people who have returned from fixed rates to tracker rates having been originally on tracker rates? Replace "fixed rates" with "interest only" and do I have a case?
 

peteb

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1,648
No you are missing the point. Your "interest only" has to be calculated on the basis of an interest rate - so it could have been interest only based on the standard variable rate or interest only based on a fixed rate, or interest only based on a tracker rate. You agreed to an SVR in this case as an alteration to your existing mortgage. So you agreed to the changed terms.
 

MOD

Registered User
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I agreed to SVR for the duration of the "interest only" period,not for the full remaining term of the loan...at no time was I informed that it was for the full term of the loan in exchange for an extra year's "interest only" period
 

Brendan Burgess

Founder
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MOD

I moved these posts from another thread, to which they were not related.

You must have signed some form of agreement to extend the interest only period?

Was that agreement not clear?

Did you take independent advice on that agreement?

Was this your home or an investment property?

Who was the lender?

Are you appealing the Ombudsman's decision to the High Court? You should think long and hard before you do so. Even if you feel that the decision is unfair, you are very unlikely to reverse the Ombudsman's decision.
 

MOD

Registered User
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We did sign an agreement to extend the interest only period but it was unclear. We were never informed that the interest rate change was for the full remaining term of the loan. We understood that the interest change was for the extended "interest only" period of the loan. We did not take independent advice on that agreement. We were not advised by the bank (KBC) verbally or in writing, to seek independent legal or financial advice. The mortgage is on our family home. We are appealing the Ombudsman's decision to the High Court. Our solicitor feels that the Ombudsman didn't take all legal issues into account in making his decision.
 

murphaph

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Just remember before ploughing serious money into a court case, that your solicitor is probably the only one who stands to lose nothing here.
 

MOD

Registered User
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I know it's a risk but it would be great if we got a group of people to share the financial burden to take this as a test case. I feel that we have a good case and if won,it would enable others to rightfully regain their tracker rates.
 

Bronte

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13,458
. We are appealing the Ombudsman's decision to the High Court.

Our solicitor feels that the Ombudsman didn't take all legal issues into account in making his decision.
My alarm bells are ringing here. How much is the quote for the High Court? This is serious money if you lose.

________________

Apart from that, based on what you've posted so far it looks to me like you requested the bank that they accomodate you in allowing you to go to interest only a second time and it appears that you signed to that effect and that in all probability you signed away your tracker (I'm taking that from the way you keep mention the phrase - independant legal advice).

I lost an ombudsman case myself that I wasn't happy about but no way would I risk ruining myself financial and mentally in taking a High Court case.

______________

Specific question for you, why did you think that the SVR only applied for the second period of IO? What lead you to believe that.
 

PadKiss

Frequent Poster
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215
Hi Mod just to update you i have one client that is interested in the grouping together of our forces re this issue will talk to you on the phone but to all others lets coordinate an approach to see if this issue can be addressed. Will be taking a good number of cases for customers of KBC in the next coup[le of weeks but with a completely different approach
 

Mauritius

Frequent Poster
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129
Hello MOD. What was the outcome of this? Did you decide not to proceed to the High Court with your case?
 

Mauritius

Frequent Poster
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129
Brendan, I think I emailed the Central Bank once in the last year or so but they told me they don't deal directly with the public. I suppose they don't have the manpower to deal with 15,000 email threads on Tracker complaints alone!
The banks seem to be extremely tight about releasing information as every decision has an implication for other similar cases.
 
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