AIB Sold our apartment at a loss which we could have kept if we were on the prevailing tracker rate of 1.5%

LizzieMc

Registered User
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Hello,

I have recently started following the boards. Thanks for all the great work.

This is our situation and am wondering if u have advice on a next move? We did make a submission to the BDO panel and were not rejected, still on hold.

Myself and now husband bought an apartment with our friend in 2006 for 360,000. We owend half, our friend owned half. We came off a fixed rate in Aug 2009 and were not offered a tracker. We were offered one in June 2007 after coming off our first fixed period.

In 2012 myself and my husband were living in the apartment with our 2 year old as our family home, paying our half of the mortgage plus rent to our friend.
We wanted to buy our own home and move on with our lives. Our 2nd child was on the way. We tried and failed to get a mortgage through various lenders in 2012 to early 2013, without having to sell the apartment. We were stress tested on rental income from the apartment relative to the mortgage rate we were on at the time (varied between 3 to 4.4%)

After failing to get a mortgage for a house without having to sell apartment, we looked at other options. Renting a house and keeping the apartment vs selling apartment at a loss so we could buy a house. Decision point was heavily influenced by our mortgage repayments vs the rent we would get for the apartment, so the rate we were on was a big factor in our eventual decision to sell at a loss in order to be able to buy a family home.

We have been through alot with AIB over the sale of the apartment, I cant even bring myself to go into it now. But at no time have we ever been a penny in arrears or 1 second late on a payment. Despite this we were required by AIB on 2 seperate occasions to go thru the arrears process.

AIB have also refused to allow us and our friend to seperate the debt.

What was the balance on your mortgage when you sold the house? 344
2) What was the shortfall? 166
3) How much did AIB write off? 0
4) What deal did they do with you - At first they said we woud just pay of the residual debt over the same time period and under same rates as we would have before the sale. Then after we were sale agreed and far into the sale process they demanded we repay all of it over 7 years, which would have meant we would never get a new mortgage for our own home. We didn't hand over the signed agreement, house sale went through and then they harassed us to sign up to 7 years until 2018 when I suspect they realised we were part of this cohort. We have repaid on our original payment schedule ontime and full at all times.

1) How much was left to pay on this before the 12% write down under the Prevailing Rate Scheme? 124
2) How much was the 12% write down? Is that the "€31k redress" figure? 43
3) Did they reduce the balance by this amount? Yes
4) Do you still owe them money? Yes 81 as of today
 
Decision point was heavily influenced by our mortgage repayments vs the rent we would get for the apartment, so the rate we were on was a big factor in our eventual decision to sell at a loss in order to be able to buy a family home.

You have identified the key point in this.

When someone asks today : Should I keep my apartment when trading up, the exercise we do is to compare the rent received with the interest paid.

If you can show that the rent would have covered the interest paid, then I think you have a good argument.

I don't know where the Appeals Panel sits on all this and whether they are bothering to hear appeals.

But you can make your case directly to AIB and if they reject it, go to the Ombudsman.

The Ombudsman would be very sympathetic to a borrower who did everything right and was shown no flexibility by AIB. If you can show evidence that they agreed, suggested or implied that you could repay the shortfall over the original term and then they reneged on this, the Ombudsman would censure them severely for that.

Brendan
 
Thanks Brendan, that s great to hear. Yes we have evidence.

So next step is a letter to AIB! Got another one of those 'we are waiting to hear from AIB' letters from the tracker panel today.

I have been reading loads but I can't quite understand how we 've gotten to a place that we can take it we should have had a tracker at 1.5%? At that rate there is no way would would have sold. Could you point me to a thread? Or explain?

Thanks a million for all of this. It is amazing to be able to post on a forum like this and have someone like yourself answer questions.
 
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