EBS What does an EBS "Variable Base Rate" mortgage mean?

POTWS2005

New Member
Hi, thanks to everyone for all for the information posted, it's been a great help in just trying to understand where we might stand in relation to our own home loan which also refers to the 'variable base rate' in our loan offer (from 2002). I have asked EBS to formally review only last week. I requested a copy of their advertised rates from 2002 onwards, got call yesterday to say this request forwarded to another dept and unsure how long it might take to provide the information.... Just interested in B26354 #517 copy of the available rates where it is stated that Home Loan variable =4.75% from start of business 13 Feb 2007 and Home Loan Rates Tracker= 4.75% applicable from start of business 8 Dec 2006 (margin 1.25)….. we would have received a communication from EBS in December to state that "due to an increase in ECB interest rates, your variable interest rate on your EBS Loan Account will rise by 0.25%" ..with effect from 1 Jan 2007. Does this support the understanding that the EBS managed this home loan as per advertised tracker rates I wonder, with the same timing as advertised or can anyone confirm the advertised rate for Home Loan variable at Dec 2006?
 

B26354

Frequent Poster
Hi, thanks to everyone for all for the information posted, it's been a great help in just trying to understand where we might stand in relation to our own home loan which also refers to the 'variable base rate' in our loan offer (from 2002). I have asked EBS to formally review only last week. I requested a copy of their advertised rates from 2002 onwards, got call yesterday to say this request forwarded to another dept and unsure how long it might take to provide the information.... Just interested in B26354 #517 copy of the available rates where it is stated that Home Loan variable =4.75% from start of business 13 Feb 2007 and Home Loan Rates Tracker= 4.75% applicable from start of business 8 Dec 2006 (margin 1.25)….. we would have received a communication from EBS in December to state that "due to an increase in ECB interest rates, your variable interest rate on your EBS Loan Account will rise by 0.25%" ..with effect from 1 Jan 2007. Does this support the understanding that the EBS managed this home loan as per advertised tracker rates I wonder, with the same timing as advertised or can anyone confirm the advertised rate for Home Loan variable at Dec 2006?
The advertised EBS standard variable rate was always the same as the advertised tracker rate from 2004 to mid 2008. The problem is that the SVR did not exist in practice or at the very least there was a conflation of the SVR & the tracker in terms of selling the product(brokers & EBS didn’t know what the variable basis was or knew it was a tracker but fudged on the details). However on the EBS IT system the underlying variable basis for all new mortgages between 2004-mid 2008 was ECB +1.25%.So there was no SVR on their system until they needed to get control back in mid 2008.

Furthermore, you have concrete evidence that in 2006 interest rate changes on your mortgage were dependent upon the ECB reference/base rate or “due to” ECB rate changes. Yet you are now on a SVR & EBS have confirmed in recent website info & press releases that changes to the SVR are not linked to a reference rate such as ECB base rate (see attached).
 

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kb_whatsgoingon

Frequent Poster
Hi b2654

so there are ebs customers out there who filled out the tracker application form > the one that had to have the ecb +XX% filled out
and even though they did this > their mortage loan said variable base rate ?
i.e.e a loan that started out as fixed
and now they are deemed impacted and have been put on their tracker rates?

I did not realise this if ...I am understanding you correctly

Then I really think That this is crazy - No way EBS can get away with this logic
What a complete mess of an organisations - who was in charge of this nonesense.
we were not even GIVEN the tracker part of the application to fill out ( in an ebs branch office by EBS staff)
 

Magsodf

Registered User
neither Were we and we asked for a tracker.. was told no the fixed rate would be more suitable for us ..
we filled out the fixed rate returning to variable base rate 4.25% in Oct 2006 .
I’d say they had a certain amount of each mortgage they had to sell .. and we obviously were a fixed one .
 

tonymac

Frequent Poster
And as ive mentioned here before my partner was never given the option of a tracker, a 3 year fixed rate was a condition of her getting the mortgage after which she would revert to the VBR. When they told her shes not getting a tracker one of their reasons was she never filledvout a tracker application formand that these were widely available and advertised. She didnt have ECB+...% on her letter of offer but her mortgage did track at a rate of ECB+1.25%, neithet did it have SVR on it after 3 years which of course shes now on. How in the name of god is that not tracker deprivation, never given a choice despite it being there in May 2007.
 

B26354

Frequent Poster
Hi b2654

so there are ebs customers out there who filled out the tracker application form > the one that had to have the ecb +XX% filled out
and even though they did this > their mortage loan said variable base rate ?
i.e.e a loan that started out as fixed
and now they are deemed impacted and have been put on their tracker rates?

I did not realise this if ...I am understanding you correctly
Yes see Trackmans post...he signed the tracker form included in that application pack except he didn’t start out on a fixed rate. His loan offer like ours states that his rate is the variable base rate.

This was not a typical mortgage offer for that time in EBS as it was their explicit policy to push people towards fixed rates from about 2005 onwards once Alan Merriman was appointed as Financial Director(see attached 2015 interview with Merriman). It was not the brokers looking for commission.

However a policy put in place just as Merriman was appointed was a general move to tracker rates being the underlying variable basis for all new loans (they were aiming for 60% of their loan book to be tracker like other banks-see attached). Their IT system reflected this between 2005-2008 whereby the variable basis for all new loans was tracker. Merriman saying in 2015 that he wanted their rates to be SVR too but this was NOT the case between his appointment in 2005 & mid 2008. They only put that policy into practice in mid 2008 (I wonder why!?!); this included changing the variable basis of the fixed rates which were trackers (usually ECB +1.25%)to SVR and eventually stopping selling of tracker rates in October 2008 in favour of SVR’s & fixed rates.
 

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B26354

Frequent Poster
If they were “steering” customers towards SVR pre 2008 you would think they would have at least included it as an option in their mortgage application packs..no sign of it, with only tracker & fixed options.
 

tonymac

Frequent Poster
I see an article in the independent by Charlie Weston today regarding the tracker redress and that its far from over. Correct as far as this group is concerned but only 2 cohorts were mentioned, ulster bank shortfall in compensation and Brendans favourite one the 6,000 AIB customers denied trackers. Both of these are very worthy of redress too but a bit of publicity for us would have been appreciated. The AIB customers are pooling their desirory €1,615 offers to take a high court case and the very best of luck to them, for now it appears Padraig Kissane is our adjudicator here and if he was to tell my partner she has no case she will accept that but this thread has to now got 523 postings on it so there must be a case to settle here, hopefully without recourse to the courts but if necessary im sure people on this thread will give this option serious consideration too, i for one cannot see how there is no case for EBS to answer here.
 

kb_whatsgoingon

Frequent Poster
Hi b26354
So I just found where trackman explained how he got back on a tracker - I am totally gobsmacked - I see how they put it down to an admin error ( OMG give me a break). And now i understand the relevance of him not going on the fixed initially - there MUSt be loads more people out there like trackman and they just have no idea that they are impacted i.e they don't know to go and ask for the application form and not the loan document.

So I am thinking.....
the fact that there is no defination on the loan document of what is a 'variable base rate' is currently a huge deal for us?? i.e. as the situation lies now the mortgage holder is the one held at a massive - massive - disa-dvantage as we are paying SVR rates
BUT
THE EBS should be at an equal dis-advantage i.e. we have a loan product from EBS
however we do NOT have agreement as to what that product is?
so why are we the ones at the disadvantage and not EBS

these loan documents do not say they are standard variable rate products ANYWHERE and,

-no one has produced any document defining a 'variable base rate'

and so why are we having to pay SVR rates
-we don't have SVR loan documents??


At the moment is it fair to say that EBS is taking our money under false pretence?

chagring us SVR rates when we have have VBR mortgages?
 

B26354

Frequent Poster
Hi b26354
So I just found where trackman explained how he got back on a tracker - I am totally gobsmacked - I see how they put it down to an admin error ( OMG give me a break). And now i understand the relevance of him not going on the fixed initially - there MUSt be loads more people out there like trackman and they just have no idea that they are impacted i.e they don't know to go and ask for the application form and not the loan document.

So I am thinking.....
the fact that there is no defination on the loan document of what is a 'variable base rate' is currently a huge deal for us?? i.e. as the situation lies now the mortgage holder is the one held at a massive - massive - disa-dvantage as we are paying SVR rates
BUT
THE EBS should be at an equal dis-advantage i.e. we have a loan product from EBS
however we do NOT have agreement as to what that product is?
so why are we the ones at the disadvantage and not EBS

these loan documents do not say they are standard variable rate products ANYWHERE and,

-no one has produced any document defining a 'variable base rate'

and so why are we having to pay SVR rates
-we don't have SVR loan documents??


At the moment is it fair to say that EBS is taking our money under false pretence?

chagring us SVR rates when we have have VBR mortgages?
There are definitions of the variable base rate but they are not included in EBS loan application forms or on the loan offer itself but in documentation provided by EBS trained brokers. Here’s one from mortgageireland.ie who sold EBS mortgages. Remember EBS are now saying their SVR is not dependent on a central bank/ECB rate so the variable base rate can’t be a SVR. Other EBS agents/brokers provided customers with variable base rate definitions that confirmed it is a rate that tracks the ECB base rate at +1.25%.
 

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kb_whatsgoingon

Frequent Poster
I recently whet through a friend's loan agreement that they got in the same period as me - mid 2008 - the two documents are worlds apart - the AIB loan document is very professional in comparasion to my barely 4 pages from the EBS and every possible loan type is defined in detail describing exactly what each item is e.g. fixed rate means this, SVR means this etc
the difference between the two loann agreements is shocking
it make joke out if the EBS loan document
surely a basic requirement of a contract is to provide a clear description of the product being sold
i will post up some pages of the AIB loann agreement later just to illustrate how different they are
I am very surprise the CBI is not concerned at the lack of professionalism shown by EBS and that they allow them to continue to trade today and call themselves mortgage masters
 

Magsodf

Registered User
Just got their final letter ? They said I wasn’t affected .. Theyre calling the rate I returned to their then ‘variable base rate’ of 4.93 % in Oct 2011 after 5 year fixed ??

It was reduced to 4.68% in Dec 2011 . So they’re saying that I’m still on the variable base rate now ..
 
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kb_whatsgoingon

Frequent Poster
Hi Magsodf -
ask them for a copy of the application form you filled in.

Also ask them where on your contract does it identify what a 'variable base rate' is.
I think you will find they don't have one.

Note : a variable base rate cannot magically become a SVR just because EBS say it does - there are 2 parties to your contract - if you both have not signed up to a clear agreement then there is a fundamental problem with it.

Don't mind any of that 'final letter' nonesense - I am on my fifth final letter from them as they are continuing to avoid giving me complete and clear answers to some pretty fundamental queries -
keep going back until you are fully satisfied you have been answered in a clear, open and honest way.
 

Magsodf

Registered User
Thanks whatsgoinon !
I’ve the mortgage application form here and there’s a line in it that says interest rate choices .. fixed , tracker and variable .. none of them are ticked ! It’s left blank !
I filled in a fixed rate form to was supposed to return to a variable base rate of 4.25% ..
they put me on a fixed rate 5 years later of 4.93 %
 

kb_whatsgoingon

Frequent Poster
Hi Magsodf -
what was the circumstances of filling it out?
did you go to an ebs branch or via a broker?
did you fill it out? etc
I do you know it was supposed to return to a variable base rate - that is not listed on your application for so that is one choice you did not choose?
 

Magsodf

Registered User
It was with a branch , they filled it in ..
I signed the end of it . We asked for a tracker but they said no the fixed would be more suitable.
We only got the fixed rate form to sign .

On the loan offer it says after fixed rate return to the variable base rate 4.25% .
 

kb_whatsgoingon

Frequent Poster
Funny that just what happened to me - so did you have 2 forms - one the homeloan one with the 3 options - I had that, filled it all out and i ticked tracker option - then at the branch they said the tracker was no longer available and gave me two pages. of an actual 8 page document, the 2 pages was the fixed rate part and the next part i was not given was the tracker application form.
so what fixed rate form do you have - how many pages etc alos what was the approx date
 

kb_whatsgoingon

Frequent Poster
Funny that just what happened to me - so did you have 2 forms - one the homeloan one with the 3 options - I had that, filled it all out and i ticked tracker option - then at the branch they said the tracker was no longer available and gave me two pages. of an actual 8 page document, the 2 pages was the fixed rate part and the next part i was not given was the tracker application form.
so what fixed rate form do you have - how many pages etc alos what was the approx date
 

B26354

Frequent Poster
The exclusion of the tracker application form is important but I think it was deliberately withheld from customers so EBS could decide what the variable basis of the loan would be when it suited them. They were hedging their bets. The variable base rate term gave them some wiggle room to stick with the tracker or force a customer back onto a SVR. The latter decision was made in mid 2008.

So the Central Bank and now the FSO should be focusing on whether the variable basis of an EBS fixed rate mortgage was made clear to customers in their loan offer. If this was not clear or there is any ambiguity at all the FSO must rule in favour of the customer.
 
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