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

gnf_ireland

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I think that haveaniceday may be referring to the opening line on page 36 but I could be wrong.
The interest rate is simply the cost of borrowing money. Interest rates change and in Ireland our interest rates
reflect those set by the European Central Bank.
I am not sure of the legalities of the word reflect?


Will be interesting to see how the courts view that sentence. The Millars lost their case in the courts (ultimately), and the clause was in their mortgage agreement not a generic brochure issued.
"Rates of interest are altered in response to market conditions and may change at any time without prior notice and with immediate effect."
 

gnf_ireland

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If EBS want to continue resisting during this review then so be it but as Gnf_ireland points out it will likely go through the courts. And the ambiguity of the term we are discussing will be emphasised during any court proceedings.
Being realistic, it is likely EBS will fight this to the end given its likely to be very costly to concede on. If all their customers can rightly claim a tracker at ECB+1.25%, then it would mean a massive payout from the bank. They are likely to fight that to the bitter end !
 

haveaniceday

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Hi there RAzvan - I am reading your attachment as saying you can switch without a penalty but you can't switch back ??- what year is this from?
 

B26354

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Will be interesting to see how the courts view that sentence. The Millars lost their case in the courts (ultimately), and the clause was in their mortgage agreement not a generic brochure issued.
"Rates of interest are altered in response to market conditions and may change at any time without prior notice and with immediate effect."
No such quote in EBS loan offers or fixed rate application forms.

The variable base rate definition was primarily used in EBS mortgages between 2004-2008. I don’t think it was used in loan offers post this date but I can’t be 100% sure about that. So i’m unsure how many accounts may be in this cohort. If it’s a significant number maybe that explains EBS’ resistance.

The variable base rate definition was primarily used as the rate that a fixed rate rolled onto. However, EBS loan offers that started off on a tracker included definitions such as:
“Interest rate (Variable): 5.25%
Interest Rate Basis: Variable ECB Base + 1.25%”

EBS mortgages that started off on a fixed rate include definitions of rates such as:
“Interest rate after 3 years:Variable Base (Currently 05.25%)”
 

RAzvan R

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No such quote in EBS loan offers or fixed rate application forms.

The variable base rate definition was primarily used in EBS mortgages between 2004-2008. I don’t think it was used in loan offers post this date but I can’t be 100% sure about that. So i’m unsure how many accounts may be in this cohort. If it’s a significant number maybe that explains EBS’ resistance.

The variable base rate definition was primarily used as the rate that a fixed rate rolled onto. However, EBS loan offers that started off on a tracker included definitions such as:
“Interest rate (Variable): 5.25%
Interest Rate Basis: Variable ECB Base + 1.25%”

EBS mortgages that started off on a fixed rate include definitions of rates such as:
“Interest rate after 3 years:Variable Base (Currently 05.25%)”
@gnf_ireland is right you can find that quote in EBS Terms & Conditiin booklet but what he did not specify in his comment is above that quote were EBS mention about all Fix available rates and the other rates and indices.
 
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RAzvan R

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No such quote in EBS loan offers or fixed rate application forms.

The variable base rate definition was primarily used in EBS mortgages between 2004-2008. I don’t think it was used in loan offers post this date but I can’t be 100% sure about that. So i’m unsure how many accounts may be in this cohort. If it’s a significant number maybe that explains EBS’ resistance.

The variable base rate definition was primarily used as the rate that a fixed rate rolled onto. However, EBS loan offers that started off on a tracker included definitions such as:
“Interest rate (Variable): 5.25%
Interest Rate Basis: Variable ECB Base + 1.25%”

EBS mortgages that started off on a fixed rate include definitions of rates such as:
“Interest rate after 3 years:Variable Base (Currently 05.25%)”
It is not about the amount of people in this cohort or about how many hundreds of milion required for compensantion because in the end of the day we pay the banks therefore are our money.
It is different when the banks and their directors dont respect the contracts and overcharged customers and conform with Central BANK is criminal ofense.
In the other hand EBS (which is not mention anywere) due to the fact that EBS Building Society was form and run by a group of teachers with the obiective to help people.
How is going to look Ireland in the face of the word if the Tracker Debacle will have Ex teachers brought to the court based on criminal act.
Is all politics and goverment along with Central Bank and FSPO will put EBS under the carpet.
Thats why is the last on the list.
AIB put people on Tracker even if those people never had a Tracker and EBS dont investigate the case where the Tracker was part of Main loan aplication.
It will be very hard for all of uș but who know maybe I’m wrong.
Regards,
RazvanR
 

B26354

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254
The difficulty with this issue is differentiating between the tracker rate and the SVR. At the time of my loan offer and issue of cheque letter the tracker rate & SVR rate are both 5.25%.

It would be significant if the variable base rate in a loan offer or issue of loan cheque was the same as the tracker rate at that time but different to the SVR at that same time. This would confirm the variable base rate was the tracker and not an SVR.

To help people with this here are the 2006-2008 dates for EBS tracker (LTV >95%) & SVR rate changes:

EBS TRACKER:

Jan 8th 2006-July 3rd 2008=
4.00 + 1.25%=5.25%

July 3rd-October 4th 2008=
4.25+1.25=5.50%

Oct 5th-Nov 5th 2008=
3.75+1.25=5.00%

Nov 6th-Dec 8th 2008=
3.25+1.25=4.50%

Dec 9th 2008=
2.50+1.25=3.75

EBS SVR:

17th August 2007-12th May 2008=5.25%

13th May 2008-9th October 2008=5.33%

10th October 2008-11th December=5.88%

12th December 2008=4.13%
 
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haveaniceday

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5.53% was the rate i was put on in july 2008 - i closed on the 17 july and on the 25 july i got a letter to say the rate was increasing by .35%
 

pguyo

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The difficulty with this issue is differentiating between the tracker rate and the SVR. At the time of my loan offer and issue of cheque letter the tracker rate & SVR rate are both 5.25%.

It would be significant if the variable base rate in a loan offer or issue of loan cheque was the same as the tracker rate at that time but different to the SVR at that same time. This would confirm the variable base rate was the tracker and not an SVR.

To help people with this here are the 2006-2008 dates for EBS tracker (LTV >95%) & SVR rate changes:

EBS TRACKER:

Jan 8th 2006-July 3rd 2008=
4.00 + 1.25%=5.25%

July 3rd-October 4th 2008=
4.25+1.25=5.50%

Oct 5th-Nov 5th 2008=
3.75+1.25=5.00%

Nov 6th-Dec 8th 2008=
3.25+1.25=4.50%

Dec 9th 2008=
2.50+1.25=3.75

EBS SVR:

17th August 2007-12th May 2008=5.25%

13th May 2008-11th December=5.33%

12th December 2008=4.13%

Our Cheque was issued on 6th may with Variable base rate 5.33%. The SVR only changed a week later but maybe the announcment was made and therefore that was the foreseeable rate. Loan Offer letter prior to that stated 5.25% matching SVR and Tracker at a variable base rate. we had no form to say what margin which other people had.
 

B26354

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Messages
254
The difficulty with this issue is differentiating between the tracker rate and the SVR. At the time of my loan offer and issue of cheque letter the tracker rate & SVR rate are both 5.25%.

It would be significant if the variable base rate in a loan offer or issue of loan cheque was the same as the tracker rate at that time but different to the SVR at that same time. This would confirm the variable base rate was the tracker and not an SVR.

To help people with this here are the 2006-2008 dates for EBS tracker (LTV >95%) & SVR rate changes:

EBS TRACKER:

Jan 8th 2006-July 3rd 2008=
4.00 + 1.25%=5.25%

July 3rd-October 4th 2008=
4.25+1.25=5.50%

Oct 5th-Nov 5th 2008=
3.75+1.25=5.00%

Nov 6th-Dec 8th 2008=
3.25+1.25=4.50%

Dec 9th 2008=
2.50+1.25=3.75

EBS SVR:

17th August 2007-12th May 2008=5.25%

13th May 2008-9th October 2008=5.88%

10th October 2008-11th December=5.33%

12th December 2008=4.13%
I updated the above table after some more digging.

Haveaniceday-This is starting to become a little clearer. As far as I can tell, the SVR when you first started the loan on 17th July 2008 was 5.33 but you were on 5.53 for a few days(tracker was 5.50). You then went up to 5.88 on the 25th of July 2008. I’ll do some more researching and see if there was another SVR change earlier that month or if indeed you were possibly on the tracker rate(not on SVR) for those few days before they moved you to SVR on the 25th July.
 
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pguyo

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80
I updated the above table after some more digging.

Haveaniceday-This is starting to become a little clearer. As far as I can tell, the SVR when you first started the loan on 17th July 2008 was 5.88 but you were on 5.53 for a few days(tracker was 5.50). You then went up to 5.88 on the 25th of July 2008. I’ll do some more researching and see if there was another SVR change earlier that month or if indeed you were possibly on the tracker rate(not on SVR) for those few days before they moved you to SVR on the 25th July.
rates at 13th may 2008
 

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B26354

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254
the loan was for 32 years
I made a few edits to posts above as rates were a few mistakes.

I’m guessing there was a little tweaking of the rate because of that but your rate wasn’t 5.33 which was the SVR at that time as far as I can tell. It went up to 5.88 a week or so after you started loan-this was the SVR in October 2008. All very odd & confusing.
 

B26354

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Haveaniceday-i think you need to get clarification from EBS about the nature of that 5.53 rate you were on for those few days. The 5.88 looks like the SVR. As pugyo states above the SVR was 5.33 in May 2008 and I think it stayed that way until October 2008 when it became 5.88.
 

RAzvan R

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54
I updated the above table after some more digging.

Haveaniceday-This is starting to become a little clearer. As far as I can tell, the SVR when you first started the loan on 17th July 2008 was 5.33 but you were on 5.53 for a few days(tracker was 5.50). You then went up to 5.88 on the 25th of July 2008. I’ll do some more researching and see if there was another SVR change earlier that month or if indeed you were possibly on the tracker rate(not on SVR) for those few days before they moved you to SVR on the 25th July.
I have explain in numeros ocasions that EBS did not have in the system the name SVR as a repayment option.
SVR policy statetment was implemented by AIB to EBS in late 2010 early 2011.
As per your ilustration above and as per repayment option with fix and Tracker rate, EBS they show the Variable rate not SVR and Tracker rate is shown the margins link to ECB.
Therefore the overall Main repayment will be as per Variable table.
Allways EBS variable Base & Tracker were the same from 2004 to 2008 because was only 1 rate.
 

B26354

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Messages
254
I have explain in numeros ocasions that EBS did not have in the system the name SVR as a repayment option.
SVR policy statetment was implemented by AIB to EBS in late 2010 early 2011.
As per your ilustration above and as per repayment option with fix and Tracker rate, EBS they show the Variable rate not SVR and Tracker rate is shown the margins link to ECB.
Therefore the overall Main repayment will be as per Variable table.
Allways EBS variable Base & Tracker were the same from 2004 to 2008 because was only 1 rate.
Razvan-I understand what you mean. So they just called it a “variable” rate between 2008-2010 and then it became an “SVR” in late 2010? I think it may actually have been early 2007 when they released a new “variable” rate that was different to the tracker. I’ve attached this image from January 2007 that describes a “new” SVR in the article but by your reckoning EBS systems called it a “variable rate.”

So “New” suggests no SVR/Variable Rate product for new EBS customers between 2004 & early January 2007?

By that reasoning the majority of new customers who took out a loan with EBS between 2004 to early 2007 could be entitled to a tracker if that variable base rate was used??Those who also took out loans between 2007-mid 2008 had contracts with same terms used e.g. variable base rate.

No wonder they are fighting this. That would be thousands of accounts.
 

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