Overpaying mortgage but wish to revert to original schedule EBS insisting on SFS form

I hope thread title ok but I think sums up my position.

I have posted before and mentioned that we have been overpaying ppr mortgage to the tune of about €750/800 per month. Original term was 20 yrs and from time to time I increased repayments (advised EBS in writing) and always confirmed that reverting at any stage to original schedule was available to us. Fine so far.

We now have 3yrs left to run at current repayment level. However we have been thinking lately of freeing up this extra money mainly for lifestyle reasons. We both have secure jobs but over past couple of years as with everyone our monthly net income is down by over €1k. We are not in financial distress but have decided but would like to have this extra money to build up some extra savings.

Problem is EBS won't deal with us until we complete the SFS and provide P60s payslips etc. I have gone thru this form in detail and it is very explicit that this is for mortgage restructuring for persons in financial difficulty. Now while some might say what's my problem I object to this as we are not in arrears and are simply requesting to revert to original schedule as we are entitled to do. In fact I am quite annoyed that EBS are in effect withholding my own money from me until I jump through hoops.

Also the form states that it will be reviewed and a decision will be made. In effect they could refuse. Has anyone else had this? On a more serious note I am concerned that if I pursue this and do as requested that this will be noted on my record that I restructured my mortgage due to financial difficulty.

Sorry for long post but am quite annoyed and please don't start telling me to stop complaining.

I know a lot of people are in real difficulty but everyones situation is of relevance to themselves!

Thanks all . A

aido71 said:

However we have been thinking lately of freeing up this extra money mainly for lifestyle reasons.

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Are you simply looking to stop making overpayments, and revert to your normal payment amount per month, or do you want back some or all of the money you've already used to pay down the loan?

If you want back money you've already paid off on the loan, I think all mortgage providers would see this as re-borrowing, unless you have made a specific agreement about the status of the overpayments in advance of starting them.

By making overpayments, and having them credited against the loan principal, you've reduced your overall interest bill. If you want to undo the overpayments, your provider will want some pro-quo.

If you simply want to stop over-paying your mortgage, and your provider is reluctant, make a written complaint, which should unwedge them from their position (or serve as the first step in escalating to the ombudsman).

We simply want to revert to original repayments. We do not want to get money back nor are we entitled to. I was always aware of that and that us fine. The argument from the EBS is that each time we increased monthly repayments we were in effect restructuring the mortgage I.e reducing term from 20 to 15 to 12 yrs. we were always putting the payment directly into mortgage repayments. My issue is that now we want to revert to original repayment schedule we are being treated as if we want to reduce our repayments for financial reasons. Bear in mind all increases in monthly payments heretofore were simply done with a letter requesting such. I also asked EBS what would happen if I simply arranged to only pay the original amount per month. I did not get a satisfactory reply but I presume I would then be considered to be tecnically defaulting and my credit rating affected accordingly!! I am increasingly frustrated at the attitude of EBS and is making me more determined than ever to give them as little as possible! Ironically I was going to use extra cash to invest in one of their savings options!! Now not a hope no matter how attractive they may be!! Nose face etc!!

If you asked EBS each time you increased your repayments to recalculate the term left to new lower term based on new repayments then you did indeed restructure the agreement and they would be correct in assessing your request to now extend your term under whatever criteria they use now, which unfortunately for you is related to distressed loans. Years ago a request to extend term would be looked at differently and subject to income, age and sufficient life cover would probably be granted without any difficulties.

To enable yourself revert to original term you should have just overpaid without officially changing the term of the mortgage, it would still have been cleared earlier but would officially have the same end day as when drawn down. That date is no longer there as you did in effect restructure it.

While I understand your thinking on the matter, unfortunately you are requesting this at a time when banks are trying to extend as few mortgages as possible in order to get in as much funds as possible. The argument that you want to invest in one of their products in fact possibly makes it worse as they are always looking at worst case scenario, for example, fast forward few years - you lose job maybe, in arrears, in front of judge and you say but they let me reduce my payments to invest in their own products, judge says - bold bank and doesn't give them what they want.

You have a valid case here and should progress the issue with the EBS. According to your post you have consistently paid a higher level of payments than required as per the initial loan agreement. (i.e. your loan balance is now at a much reduced level than it would have been had you maintained your original agreement). there is no question that making voluntarly additional mortgage payments is a commitment to a new loan schedule. This is not a valid position for the BS to take.
You are now fully entitled to revert to a repayment level that will clear your loan by the original agreed date. If EBS refuse to change the DD amount then cancel the DD and commence repayments by Standing Order. If they fail to re-instate the DD for the reduced level of repayments then contact the Ombudsman.
In replying I am assuming the circumstances relating to your mortgage are as described above.

Thank goodness for brendan44's reply. Just read through this thread with growing disbelief until his post.

I've often topped up payments on bank loans and then missed complete payments as it suited me , knowing always that I was on schedule to meet or (usually) beat the final deadline.

I'm doing it now- I paid extra for the last few months and stopped this months payment because I needed the cash. Never a bother.

Thanks Brendan... Yes you have it correct and my difficulty accepting EBS point of view is that previously when increasing repayments the letter I wrote simply said ' please increase my monthly repayments by €xxx " unfortunately I don't have any copies of these and confirmation that I could revert to original repayments was always verbal... But that was when one could deal with banks on the phone! Perhaps I am being over sensitive but having always played by the rules and behaved in a responsible manner I am infuriated that I am being treated this way. To be fair to the branch staff the manager is sympathetic but her hands appear to be tied in most matters and if she is to be believed can hardly answer a phone these days without referring it up the food chain! Thanks for input everyone.....

aido71 said:

The argument from the EBS is that each time we increased monthly repayments we were in effect restructuring the mortgage I.e reducing term from 20 to 15 to 12 yrs. we were always putting the payment directly into mortgage repayments.

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A poor argument on their part, imo. If you can dig out your mortgage contract, examine it for clauses about over payments, which will probably state something closer to your understanding than their argument.

Unless your previous letters expressly requested them to restructure the loan with a different end date, then they do not have your express consent to their "understanding", and this will play a large part in helping any third party mediator (like the ombudsman) in assisting with resolving this.

I think it's time you made a formal written complaint about their behavior to their customer services department, and requested a formal position from them on this. Explain your side, quote your previous correspondence, and request that they desist from treating your overpayments as their rightful repayment schedule. If/when that doesn't work, write another letter to the financial service ombudsman, and include your letters (down through the years if you can), their responses, and I think you'll have a good case.

aido71 said:

...unfortunately I don't have any copies of these and confirmation that I could revert to original repayments was always verbal...

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You can ask EBS to provide you with all documentation about your loan. If they become difficult with this, then a data protection complaint will whip them into line. The office of the Data Protection commissioner takes a while to process things, but they get particularly good results.

To be fair to the branch staff the manager is sympathetic but her hands appear to be tied in most matters and if she is to be believed can hardly answer a phone these days without referring it up the food chain

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This is not an adequate excuse for the apparent inexcusable behaviour of the Bank on this issue. Clients are entitled to a competent level of service from all financial institutions & you should ensure that you do not let this matter rest with a reluctant letter of acceptance from the local Bank manager. send a registered letter of complaint to both the local office and the Bank CEO. make sure that you accurately detail the chain of events up to date and your complete dissatisfaction with the response from the response. Specify that you are referring the issue both to your solicitor and the Ombudsman unles it is addressed both speedily and effeciently.
Sometimes I wonder how these people manage to hold down a job

Thanks all for your input. I was beginning to think I was the one being irrational good to see maybe I am somewhat normal after all! In fact while this started as just an option to maybe free up some cash is turning into a point of principle as I feel like we are being held to ransom in some way! Anyway will get to writing and will see how I get on. I will keep everyone posted on how I get on. Once again thanks for the input.... Greatly appreciated

Hi Aido

This is ridiculous on EBS's part.

you need to escalate it to someone more senior to sort it out.

I would suggest reducing payment but you may end up with a bad credit record.

brendan

Make a formal complaint to the EBS and let them know you are also contacting the Banking Ombudsman or Financial Regulator to check if what they are saying is true. Maybe then they will deal with you.

I have to say I am amazed. I am with EBS also and was just about to increase my monthly repayments but was concerned about ensuring that I could revert to original payment schedule at any time. I think I will just keep saving and then go in and ask for a one off lump sump payment agreement

same issue with the ebs

i often read the threads on tracker mortgages and only after reading this one did i decide to register.

i have exactly the same problem as aido71 and i can completely understand the frustration.

i have a tracker with the ebs and have been overpaying twice the normal repayment since 2006. we have a second baby on the way in June and as a result i want to free up some of this overpayment for my family.

previously all i had to do to set up the overpayment was to write a letter to the branch and it was sorted. so in March i did the same and the staff in the branch said that was fine. then i got a call from ebs head office saying that as i was restructuring the loan that i had to fill in the SFS, give three payslips and the last three months bank statements and set up a new mortgage protection policy.

i was very annoyed by the ebs for asking me to do this and argued it out with them for about two weeks, but they insisted that i have to do this.

i also asked then for my original mortgage contract and i got it and there is no mention of any of this in that, albeit it dates from 1999.

so today i filled in the SFS, got the other details and have arranged the new mortgage protection policy.

but i am still annoyed and after reading these threads i really don't want to give the ebs this information as i have never missed a repayment and have never been in arrears.

any advice Brendan or others?

thanks

Hi liamo.....not that it changes anything but good to know i am not alone!...I was the same....told just put it in writing then suddenly all changed and hit with requests for SFS..P60s..payslips the works...(BTW i am not on tracker just SVR)....excuse from Branch is new Legislation requires this.
Based on replies here am going to chase this one all the way.....gonna start with letter to Branch and Head Office and take from there. As i mentioned at present dont need the money to survive and in fact the idea of main mortgage finished in 3yrs highly attractive. But i want to be able to access this money if needs be (have second property rented..if tenant left then would have to find aprox €650pm and with increased taxes/reduced pay etc our safety margin of income/expenditure dramatically reduced).i am sure it may take a while for responses but will def post back either way.

excuse from Branch is new Legislation requires this.

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Hi Aido

This could well be an unintended consequence of the Code of Conduct on Mortgage Arrears.

Ask them what legislation requires this.

Then write to the Consumer Codes Section of the Central Bank and ask them if that is their reading of it. I doubt it is.

brendan

One consequence of this bank's actions is that borrowers will be reluctant to make extra payments. So, bank is effectively discouraging people from paying off early.

I have become a bit nervous about continuing my habit of paying off lump sums or bigger monthly payments and will now double-check with my lender-AIB that there's no chance of doing what Ebs are doing.

Maybe news media should be made aware of this.

I have been overpaying my mortgage for 2 years with the EBS (with the EFFECT of reducing the term, but not actually restructuring the agreed term) and was about to reduce the payment back to the standard required amount for the same reasons as the OP. I was told upon contacting the branch that all I had to do was to send in a letter requesting that the overpayment stops. He even told me how much it would be when I stopped the overpayment.

I will let you know what happens!

Hi Brendan

The ebs told me that it was as a result of the code of condiuct on mortgage arrears. It didnt make any difference how I argued it with them, they kept quoting the new legislation. I replied by saying that I was never in arrears or never even missed a repayment, so the legislation should not apply to me. But they would not accept this.

Aido, i still understand your frustration, my mortgage has 4 years left, but family circumstances mean that I need to free up the overpayment money. The level of detail that they ask for in the SFS is very intrusive for someone with a good credit rating.

Littlepiggy, I was also told by my local branch that all that was required was a letter. Wait until it goes to head office.....Head office they told me that I had in fact restructured 6 years ago when I requested to overpay which did reduce the term. I think the same may apply to you....

Please refer to my earlier post.

44brendan said:

This is not an adequate excuse for the apparent inexcusable behaviour of the Bank on this issue.

Clients are entitled to a competent level of service from all financial institutions & you should ensure that you do not let this matter rest with a reluctant letter of acceptance from the local Bank manager. send a registered letter of complaint to both the local office and the Bank CEO. make sure that you accurately detail the chain of events up to date and your complete dissatisfaction with the response from the response.

Specify that you are referring the issue both to your solicitor and the Ombudsman unles it is addressed both speedily and effeciently.

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Voluntary overpaying a mortgage/loan does not negate the original contract agreement, irrespective of the attitude of the Bank/Financial Institution.

I assume that you have a written response from the Bank. Your next approach (unfortunately) is to complain to the FSO?

Do not continuing making the high repayments (if this puts you under financial pressure) while awaiting a response from the FSO. The law of contract also applies here, but I would hope and expect that the FSO will accept your side of this disagreement.

There is no rationale for voluntary overpayments being an implicit change of a loan agreement.