PTSB Refused Tracker on second mortgage

Greevypop

New Member
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In 2003 we took out a mortgage to purchase our primary residence, a tracker of ECB + 0.75.
In Oct 2007 we used equity in our primary residence to remortgage to buy a site on which we hoped to build and move to. We asked for a top up of the first mortgage (verbal request) but was told no, that trackers were no longer available. We were then given a second mortgage on the standard variable rate. Are we one of those affected ?, should we pursue it with the bank?
 
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peemac

Frequent Poster
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648
quick answer is no.

You redeemed the first mortgage and took a new mortgage out under new terms and conditions.

Unfortunately in 2008 the value of trackers was not understood by most and no-one foresaw the banks having such a difference between ecb and standard variable rates.

These days banks are offering tracker moving mortgages, but that's simply a product they choose to offer and not obliged to offer so no onus on them to offer it retrospectively.

Probably ideally you would have simply had a second separate loan for the site, but banks were running scared of such loans at that stage and would probably have said no. As you could have passed on the site and left everything as is, it would be nigh on impossible to build a case for any wrongdoing by the bank.
 

Monbretia

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1,638
Were not all the banks finished approving new trackers by Oct 2008 in which case they couldn't give you what they no longer offering as a product.
 

Greevypop

New Member
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Thanks for your reply peemac, but I didn't make my self clear originally. We did ask to top-up the original tracker mortgage and the manager said no, that we would have to take out a new mortgage to buy the site (against our primary residence), which we didn't question and did on a standard variable rate. That left us with two mortgages on the same property, one on a tracker the other standard variable. Should we not have been allowed to top up the tracker one? Also my dates were slightly out, we applied in late July 2007 and drew down in the Oct 2007.
 

Monbretia

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1,638
There is no obligation on the bank to allow you increase any mortgage tracker or not, in fact most top ups are new separate loans but secured against the same property just as you have/had. New portion would always be at the prevailing rates at the time it was drawn down. If it were all to be in the one loan then it isn't a top up you would be doing it would be a totally new mortgage and again at prevailing rates.

Now as to why you were not able to get a tracker for the new portion in 2007 I don't know, maybe trackers were only being offered by the bank to buy houses and not for top ups for other purposes. Yours was essentially an equity release which may not have come under the criteria for a tracker, who knows at this stage!
 

Monbretia

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You can try ask why a tracker rate was not available on the top up portion at the time. But you would never have been able to just increase the amount of the existing one and draw down more on same loan at same rate so no point going with that angle, the usual method of top up was a separate loan as you got.
 

Monbretia

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1,638
No not necessarily if the bank were not doing trackers for that purpose or anyone of many reasons why you didn't fit the criteria for a tracker but it's only guesswork at this stage as we don't know the criteria. Just because you asked for it doesn't mean you get it and just because the original mortgage was a tracker did not mean the top up had to be, it could have been anyone of the available products for your purpose for example a fixed rate had you wanted it.
 

peemac

Frequent Poster
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648
Thanks for your reply peemac, but I didn't make my self clear originally. We did ask to top-up the original tracker mortgage and the manager said no, that we would have to take out a new mortgage to buy the site (against our primary residence), which we didn't question and did on a standard variable rate. That left us with two mortgages on the same property, one on a tracker the other standard variable. Should we not have been allowed to top up the tracker one? Also my dates were slightly out, we applied in late July 2007 and drew down in the Oct 2007.
With this info, then a definite no entitlement.

Even when banks do "top-ups" they are in reality separate loans but merged together for a single payment and presented in layman's terms as a top-up. - the new loan or top-up would simply be for the exact length remaining on the original loan. As many mortgages were standard variable rate, then the rate for this new loan (or top-up) would have been identical hence many people did not realise it was a separate loan.

In your case you have kept the tracker on your original loan and don't have one on the new loan. As they were no longer offered at the time of the second loan, or if they were available, they were probably not offered on site purchases, you would have no entitlement to a tracker on that loan no matter what they called the loan.
 

Popey32

New Member
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1
Hi , I have a very similar situation. We applied for a " top -up" in 2007 as we were selling are old house and moving to a new one , we kept our original racker mortgage and were told no for the second as they no longer do trackers we would have to take a variable rate , which we did , Was this lies ? As I see from this forum thet were still offering trackers in 2008
 

Monbretia

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Kind of same answer to original poster, they were still doing trackers in 2007 but maybe not for the purpose you were borrowing. What do you mean you did a top up to move to a new house? Did you clear the original tracker on selling the old house and was the top up just an equity release for deposit or something? If so it was an equity release rather than a house purchase and maybe they did not offer trackers for that purpose.

There is no obvious reason why they would 'lie' to you, they were still doing trackers for new house purchase mortgages obviously so there must have been some reason why you were not eligible for one on your loan.
 
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