Would UB allow me to replace investment property security, but keep tracker?

Discussion in 'Issues with tracker mortgages' started by diceyreilly, Mar 6, 2017.

  1. diceyreilly

    diceyreilly Registered User

    Posts:
    19
    I contacted Ulster Bank Securities dept in Leopardstown approximately 5 years ago and was told I could replace security on an existing BTL tracker mortgage (First Active originally)for a higher value property. I contacted them recently but got a negative response from front line. I am reposting this in the hope that someone has gone thru similar process with Ulster Bank or any other financial institution and what the process was.

    Approximately 250k outstanding from original advance 310k tracker ECB+1% 12 years to run with Ulster Bank repayments always up to date.

    Approx. Existing Security:
    Investment House 300k
    Investment Apartment 100k (original purchase price 270k)

    Proposal:
    Replace security of apartment (100k)with another unencumbered Investment residential property 300k.

    Possibly request replacement security limited to 100k as this would give the same security of 400k on 250k balance. At worst allow full security(investment residential house + investment residential house) 600k to UB total security. This would leave Ulster bank in a much stronger position 42% LTV proposed rather than LTV 62.5% existing.

    Has anyone replaced/released the assets of an Ulster tracker mortgage with an asset of same or higher value as above without effecting the rate?
     
  2. Brendan Burgess

    Brendan Burgess Founder

    Posts:
    32,804
    I don't think that they are under any obligation to allow you to do this, but they might be persuaded given the current negative publicity around the removal of tracker mortgages.

    Your best approach is to apply formally to do so. You should offer to pay their legal costs of the transaction.
    If they reject it, appeal it.
    If they continue to reject it, you could try the FSO, although I am not sure on what grounds.

    However, it might just be simpler to sell the €100k property and pay the proceeds off the mortgage.

    Brendan
     
  3. Monbretia

    Monbretia Frequent Poster

    Posts:
    1,160
    What is the value of the first property now? Why do you want to switch them around, are you selling the apartment that is cross secured with the house?

    To be honest it sounds like the phone contact in Leopardstown 5 yrs ago gave you wrong info at the time.
     
  4. cremeegg

    cremeegg Frequent Poster

    Posts:
    1,900
    What does it say in the contract. If the permission was policy at the time it may not be policy now. If the right to do this exists in the contract, they cannot just change their mind.

    No point in asking UB about a FA contract, they have no clue. Maybe show the contract to a solicitor.

    There were many wonderful things in that FA mortgage, but it does seem unlikely.
     
  5. Ravima

    Ravima Frequent Poster

    Posts:
    2,227
    I had a similar suggestion. Local branch turned it down, so I wrote to CEO, who wrote back to say query should go through local branch! Good luck in your quest!