Why don't the lenders simply issue corrected statements in redress cases?

Brendan Burgess

Founder
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38,102
I have spent a lot of time trying to figure out AIB and BoI redress calculations.

ptsb just sent the redress figure and told people that they could request the calculations but they would run to many pages.

But thinking about it lately, why do the lenders not simply reissue the annual mortgage statements with the actual payments made and the corrected interest rate?

Let's say that the balance on my mortgage today is €150k having been charged the SVR.

If the right interest rate is applied, then the balance would fall to say €120k and I would see the overcharge of €30k immediately.

I could also check the calculations very easily. Look at the balance outstanding each month and multiply by 1/12th of the annual mortgage rate.

Brendan
 

notabene

Frequent Poster
Messages
338
I agree Brendan, calculations should be supplied without question - and even if they do run to many pages - the people are entitled to see how the sum was arrived at without further hassle of requesting them
 

Brendan Burgess

Founder
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38,102
Hi nb

I don't think that many would run to many pages.

Most annual mortgage statements have 12 payments and 12 interest charges. Even if there are more payments, TRS, etc, it would be so much easier to check.

Brendan
 

SaySomething

Frequent Poster
Messages
554
Hi nb

I don't think that many would run to many pages.

Most annual mortgage statements have 12 payments and 12 interest charges. Even if there are more payments, TRS, etc, it would be so much easier to check.

Brendan
Mine would run to a few pages given it has to be dated from 2010. I had to get my figures checked independently because the redress letter was so unclear. If I'd received a statement it would have made life considerably easier.
 

IKEA06

Registered User
Messages
3
Brendan,
You could do as you say and "Look at the balance outstanding each month and multiply by 1/12th of the annual mortgage rate" but you would only get an approximation of the correct interest charge. All the major banks accrue interest on a daily basis - so 31 days for January and 28 for February. Quite a difference between the two months. And since the accrual is daily then should the balance or the interest rate your approximation will be even further away from the correct figure.

Your approach would fall under the philosophy of "Close enough is good enough". I don't believe that should ever be true when dealing with banks and redress calculations. They have a contractual obligation to charge the correct amount of interest, and given the circumstances they should make their methods and calculations clear to any customer who wishes to review them.
 

Brendan Burgess

Founder
Messages
38,102
Hi IKEA

The lender would calculate the interest correctly and exactly. But they would show it the same way they do in the ordinary statements.

People would be able to check the interest. They could get a spreadsheet and calculate it exactly. But as the interest rate will be a tracker rate, I would certainly be happy enough with an approximation.

Brendan
 
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