Underfunded weekly mortgage

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Underfunded BOI

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I was coming to the end of my 20 year mortgage but it was underfunded ( the bank consistently debited the incorrect amount). I complained and the bank explained that it was due to their system not being able to calculate weekly mortgage but no offer to compensate. I am now left with an outstanding balance. Anyone run into similar trouble?
 
Are you saying that the weekly mortgage payment should have been €400 and they charged you €300?

You knew this but didn't up the payment yourself? So you knew that your mortgage would not be cleared.

The banks normally set up a monthly payment, so presumably you requested a weekly payment and they facilitated you.

You haven't lost out so you shouldn't be getting any compensation.

Assuming I have understood you correctly.

Brendan
 
Underfunded BOI said:
I was coming to the end of my 20 year mortgage but it was underfunded ( the bank consistently debited the incorrect amount). I complained and the bank explained that it was due to their system not being able to calculate weekly mortgage but no offer to compensate. I am now left with an outstanding balance. Anyone run into similar trouble?
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There is no loss so why would there be compensation?
 
Or, was your monthly repayment, say, €1,000 but you were making weekly repayments of €250? In that case, even if their system couldn't give you any benefit for weekly repayments, you would still have been paying 52 x €250 = €13,000 instead of 12 x €1,000 = €12,000. You probably need to clarify with some actual or representative figures.
 
Brendan Burgess said:
Are you saying that the weekly mortgage payment should have been €400 and they charged you €300?

You knew this but didn't up the payment yourself? So you knew that your mortgage would not be cleared.

The banks normally set up a monthly payment, so presumably you requested a weekly payment and they facilitated you.

You haven't lost out so you shouldn't be getting any compensation.

Assuming I have understood you correctly.

Brendan
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Will clarify

BOI were taking the incorrect mortgage payment from my personal account each month. I was not aware of the discrepancy. When it came to the end of the twenty year term there was an outstanding balance of more than 3K. I complained to BOI and the official response was that the BOI mortgage calculation system could not calculate weekly mortgage payments ( mine was a weekly mortgage for the last six years or so of the term).

I hope that explains.
 
Brendan Burgess said:
Are you saying that the weekly mortgage payment should have been €400 and they charged you €300?

You knew this but didn't up the payment yourself?
Click to expand...
Or the weekly mortgage payment should have been €387.96 and the bank took €378.96. Would you have spotted the difference, which approximates to €3,000 weekly over 6 years.
 
Blackrock1 said:
There is no loss so why would there be compensation?
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There was no loss but I was left with an unexpected ‘balloon’ payment at the end of my mortgage term. We had made financial arrangements based upon the mortgage being paid within term. Instead of a few extra euros per week over many years there was an outstanding balance of 3k at the end of mortgage term. The technical term is ‘underfunding’
Brendan Burgess said:
Why was it put on weekly payments if they couldn't calculate them?

Brendan
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you man remember maybe 2013 or so , Irish times consumer page advised changing to weekly mortgages as there would be a saving compared to monthly repayment ( am not sure there is). I applied to BOI and was changed to weekly and thought no more about it. Got a letter from BOI in late 2021 saying my mortgage may not be paid off in full (term ended August 2022). When i contacted BOI they were unable to put an exact amount on the shortfall that would remain at the end of term. On the phone at one stage they said 16k but the eventual sum was just over 3k. Isuspect everyone on weekly mortgages with BOI will have an outstanding balance when term ends. Just was wondering if anyone else was out there in the same situation
 
Underfunded BOI said:
you man remember maybe 2013 or so , Irish times consumer page advised changing to weekly mortgages as there would be a saving compared to monthly repayment ( am not sure there is)
Click to expand...

Wow! I remember it well.

Did you not see the correction the following week?

Anyway, you have not lost out. You underpaid your mortgage.

It might be worth raising with the Ombudsman. Maladministration.
And with the Central BAnk that BoI's systems are not up to scratch.

Brendan
 
Underfunded BOI said:
advised changing to weekly mortgages as there would be a saving compared to monthly repayment ( am not sure there is).
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There isn't. Or nothing material.
The "saving" is if you make quarter of a monthly repayment every week, you're actually making the equivalent of 13 monthly repayments in a year, so you pay mortgage off quicker.

What's the 3k in relation to the original mortgage? It's difficult to calculate an exact weekly repayment, but 3k sounds like a lot.
 
RedOnion said:
There isn't. Or nothing material.
The "saving" is if you make quarter of a monthly repayment every week, you're actually making the equivalent of 13 monthly repayments in a year, so you pay mortgage off quicker.

What's the 3k in relation to the original mortgage? It's difficult to calculate an exact weekly repayment, but 3k sounds like a lot.
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ClubMan said:
Or, was your monthly repayment, say, €1,000 but you were making weekly repayments of €250? In that case, even if their system couldn't give you any benefit for weekly repayments, you would still have been paying 52 x €250 = €13,000 instead of 12 x €1,000 = €12,000. You probably need to clarify with some actual or representative figures.
Click to expand...
 
Brendan Burgess said:
It might be worth raising with the Ombudsman. Maladministration.
Click to expand...

I'm pretty sympathetic. A mortgage holder shouldn't be expected to be able to test that a mortgage is being repaid in line with the contractual terms. I have a spreadsheet to approximate my mortgage schedule and can never get it to exactly align to the euro with what BoI take out.

There's no harm in the OP making an official complaint to BoI asking for the cancellation of the residual debt on the grounds that they were not debiting your account in line with the agreed contractual terms.

If this fails with BoI take it up with the Ombudsman. You may not win but if you don't it's no extra loss
 
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