KBC KBC: Tracker vs Variable Rate

PJDCol

Frequent Poster
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134
I am hoping someone could advice on what the next step could be for people in similar situations like myself who are stuck on massive variable rate (4.5%). I am one of the seemingly thousands of people who was originally on a tracker mortgage and fixed (at the advice of all banks) but did not know or realise (like everyone) the long term implications of signing that fixed rate form. The fixed rate form did advise (in small writing) that I would thereafter be on a variable rate.

I did question this with the bank as the rates began to fall in 2009 where they advised me that I had signed a documentation.There was not even a highlight (ie bold letters) on the fixed rate instruction document to indicate this change to the standard variable rate. In fact, to make it worse, the original loan offer was also called "a" variable rate (not tracker) that would not go 1.25% above the ECB rate. To me, there is clearly no information to explain the change to a different form of "standard" variable rate and there was also no disclosure of the effects of been moved.

KBC (The Bank of You apparently), as expected, responded to confirm it was “clearly notified of the terms”, “Clear and concise” and “Terms were clearly outlined”. Anyone and everyone knows this is clearly not the case.

I then sent my complaint to Financial Services Ombudsman who wouldn’t even look at my case. They advised “a consumer is not entitled to make a complaint if the conduct complained of—occurred more than 6 years before the complaint is made”.

It is fairly obvious that I didn’t notice this issue until 2009 when I was been removed from the fixed rate but they advise the complaint is regarding the lack of information I was provided when signing the documentation in 2006.

In recent High Court cases (Permanent TSB case) in the challenge to the Ombudsman, I saw comments from the results that “a bank should properly alert its customers of the potentially serious adverse consequences of a particular decision”.

I also researched similar cases in the FSO annual reports over the years where there was examples of cases approved by the FSO where the documentation was not clear and the consequences (good or bad) of moving from the tracker to the fixed interest rate for a set term were not sufficiently set out in the documentation. However I then also saw results of people in similar cases that were rejected by the FSO.

There does not seem to be any consistency or clarity about where people stand. You see front page headlines about people been returned to tracker mortgages following appeals that gives you some hope. It seems a challenge in the high court is the only way this happens.

Is there advice or anywhere for people in my situation to go or should we just forget about this?
 

Brendan Burgess

Founder
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It seems a challenge in the high court is the only way this happens.
Hi p

The Ombudsman makes a decision as to whether the documentation was clear. In many cases, he has held that the documentation was not clear, and he ordered the return of the trackers.

However, I understand that he has decided that the KBC wording was clear and, to the best of my knowledge, he has rejected all complaints about KBC.

You might have some chance in the High Court. It would be a long process and potentially very expensive. KBC will defend it until the very end. But it's possible that they might settle it on the steps of the court as they would not want to risk a precedent setting High Court ruling against them. By the time the case gets to court, the statute of limitations would have run out for everyone else.

Brendan
 

PJDCol

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134
Thanks Brendan

Do you think there is anyway for the FSO to even look at it?

As mentioned they advised “a consumer is not entitled to make a complaint if the conduct complained of—occurred more than 6 years before the complaint is made”.

All of this tracker mortgage debate is based on the actions of banks in around 2005 so are they not looking at any these complaints anymore?
 

Brendan Burgess

Founder
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Hi p

Even if you convinced them to look at it, they would find against you.

If they consider your complaint, you can't go to the High Court

Brendan
 

Sligolive

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58
Hi P

I am in the same boat as yourself re KBC. It is continually gut wrenching to watch what KBC are being allowed to get away with by the FSO.

The key consideration with KBC mortgages was that they were not tracker products. The products were variable rate products with an interest rate cap referenced to the European Central Bank rate. So despite the fixed rate instruction stating that you would revert to the standard variable, the interest rate cap should also have been applied at termination of the fixed period, as per the original loan documentation. It appears this point has not been understood by the FSO and he has consistently maintained his position on this.

Re the six year rule referred to in your post, there may be some good news coming on this with the amalgamation of the FSO and Pension Ombudsman's office. Furthermore, it has been suggested previously that a group action against KBC may be worthwhile. Also, perhaps the new Ombudsman may take a different approach as to weather the KBC fixed rate instruction form was clear.
 

PJDCol

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134
Due to the precedent set by the recent tracker mortgage cases, has anyone looked at going back to the FSO or has anyone contacted KBC on it? Do people feel it is worth going back on this?

I wrote them a letter requesting information that would I feel would help me in a potential case but they have not replied to me (this was months ago).

Thanks again.
 

bogstandard

Registered User
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23
Is there a case for a file to be brought to the Central Bank outlining the unfair practices of KBC who did not act in their customer's best interest?

From what I see the following applies to KBC

1. They sent out fixed rate instructions unsolicited.

2. They highlighted an expiry of the "offer" and that expiry was at the top of the instruction. The expiry was about 10 days after receipt, so to expect the consumer to get "independent legal advice" and then make a decision and then return the form before expiry of the "fixed rate OFFER" is ridiculous, especially in summer and also in light of constant reports that rates are rising - thus you may act in undue haste to an "offer" that expires in 10 days.

3. They did not offer the most suitable product - that being a 3 year capped tracker which was available at that time.

4. Their mortgage document states that the mortgage is a variable rate with a margin over ecb. The fixed rate says the rates "reverts" to the bank's standard variable rate - this is ambiguous at the very least and without an explanation of what that rate is, or at the very least stating the variable rate is "currently x%", it is confusing. Also at the time in 2006 (for most people) the "standard variable mortage rate" of all banks was what we know as a tracker rate.

The ombudsman took a very legalistic view of the document - which I don't believe was the right approach considering the reasons the ombudsman was set up.

People feared going to the high court as KBC would have had the best legal brains fighting against you and high court would also have to look for a legalistic point of view.

Central Bank however has a code of practice and can direct banks to change things that they feel was not in the customer's best interest and which went against the code of practice.

With the Central Bank currently investigating the tracker issue, possibly (ar it may already have been done) someone with access to the investigation team can do a report on the KBC trackers?
 

todo

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264
Is there a case for a file to be brought to the Central Bank outlining the unfair practices of KBC who did not act in their customer's best interest?
Absolutely at a minimum they should be notified of this underhand practice.

The FSO is not a champion for the consumer, he will be satisfied that you were told to get legal advice. It seems the banks are allowed to trick their customers anyway they like and the customer protection code is really only a set of guidelines.
 

Gerry Canning

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2,510
Bogsdtandard.

Forget the Central Bank acting for consumers.
History has well proven they do not act for consumers.
Their spokesmen are trotted out to say they {prioritize } items yet it takes 7 years + court cases to get PTSB to sort matters.

Yet we still believe them !.
...........................
The Consumer Protection Code , is not a protection ,solely a wish list , it has nil real teeth.
As you point out our Financial Services Ombudsmen, FSO , is a construct that largely stays within legal constraints and ignores what we understood to be its brief.

..............
Both these beauts, Central Bank and FSo make the odd stab at being somewhat consumer orientated, they ain,t !
 

PadKiss

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215
Hi all I know there is a frustration out there re KBC and what they did they are on my horizon and I will update in a couple of weeks as I intend bringing a challenge to this lender also because the intention of the product was altered for reasons outside of the original agreement padraic
 

PJDCol

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Messages
134
Hi all I know there is a frustration out there re KBC and what they did they are on my horizon and I will update in a couple of weeks as I intend bringing a challenge to this lender also because the intention of the product was altered for reasons outside of the original agreement padraic
Thanks Mr Kissane for your comment as I have been following your cases for some years now. Any update or information on your challenge against KBC would be very much appreciated.
 

Sligolive

Frequent Poster
Messages
58
Hi P...maybe the recently announced Central Bank review of practices across all banks regarding tracker products might bring some hope of justice to the thousands of mortgage holders who have been shafted by the banks.
 

PJDCol

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Messages
134
Hi all,

As sort of a starting point, 3 months ago I sent KBC a letter of complaint requesting some information and they have not retuned my request despite follow up phone calls. I felt these were fairly basic requests for information to back up their view that I was provided with the correct information.

This included proof that the bank did the following:

1. Information about what a “standard variable rate” is when I signed up for it. This information is not on the fixed rate document or is also not provided on the original loan offer. The original loan offer explains a variable rate differently. I asked if this information was available then please provide a copy e.g. company website.
2. That I was provided with clear confirmation that I would be losing my original “variable rate” (tracker) signed in my loan offer.
3. Potential cost implications were provided to me about moving from a “variable rate” (tracker) signed in my loan offer to a “standard variable rate" (signed in fixed rate offer).
4. Any other information you feel is relevant to support that I was provided with all information required.

At this stage its seems they have refused to provide me with this information. I requested in the complaint to confirm by letter if they do not have or they do not wish to provide me with it.

Are bank required to provide me with this information or as I said confirmation that I won't be provided with it?

Thanks again
 

Leighlinboy

Frequent Poster
Messages
115
What level of confidence is there that these reviews are any different to the previous ones ? The name KBC has given me sleepless nights over the past few years same as many posters . The constant letters coming in the door advising of fixed rates at a time when rates were rocketing, I'm
Hoping this practice will be reviewed if this is an all encompassing piece of work . Never lodged a complaint with the ombudsman as I seen so many similar stories being rejected , literally word for word same case as my own . The wording on the form was sufficient appears to be ruling in each case . Here's hoping for a miracle !
 

ash693

Registered User
Messages
14
A miracle indeed! But us Kbc's have to have hope that someday we will get what we deserve! Same story from me.....had tracker and fixed in 2006 but was never returned to tracker. Never lodged a complaint with ombudsman either due to all the failed attempts from others. I emailed central bank this week
 

Sligolive

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Messages
58
Hi....I took my KBC tracker complaint to the FSO who did not find in my favour.However, I recently advised the Central Bank of the complaint so as to inform the tracker review the Central Bank is completing. The Central Bank responded to me this week and suggested that I resubmit my complaint to KBC. I suggest that other KBC customers who were also shafted 're their tracker rate should also contact the Central Bank with their complaint. It is only when the Central Bank see the significant number of individual customers who were mislead will anything be done about this.
 

Leighlinboy

Frequent Poster
Messages
115
In my own case I enquired why I wasn't returned to the tracker as previous , the fixed rate switch forms stated in the small print that a variable rate would be applied, KBC sent me a copy back , low and behold there it was, most of the cases said the wording was sufficient . It's the practice of enticing people off a tracker to fixed with constant letters without explaining full
Implications of it that is the only hope I can see . Was a major factor in my decision as rates were shooting up ! Seems so foolish in hindsight ... A lot changed in the 5 years . I'll
Go back to central bank
And fso/KBC , nothing ventured nothing gained , they need to know we exist ! Cheers .
 

bogstandard

Registered User
Messages
23
On the thread about the CB reviews, Brendan says that the CB review will only go back as far as the commencement of the Code f Parctice in 2006. This was August 1st 2006, so if you signed a fixed rate form prior to this, there may not be any hope.

Possibly the CB should look extend it to the time they issued the code to the banks (May) rather than the effective date as most of the KBC tracker to fixed were in May, June & July.
 

odonovanpm

Registered User
Messages
10
I had similar dealings with KBC. As others have stated, the key here is the original contract stated it was a variable rate mortgage with a price promise of +1.X% on the ECB. I was bombarded with fixed rate offers with absolutely no indication on the documentation that this offer would be removed.

I have recently been in contact with the FSO, Central Bank and KBC. All confirmed that a review process is being put in place and will run through 2016. I guess a lot of us will be hoping that the process is undertaken by an unbiased third party, as I am certain that KBC will do everything they can to not reinstate the original variable rates. It was reported that the FSO found in the banks favour in 83% of tracker disputes filed to date - sounds like another bank bailout to me.
 
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