Brendan Burgess
Founder
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By Niall Brady
Negative response
Mortgage customers of Permanent TSB took their campaign for a fairer deal to the Dail last week — only for the government to treat them with the same disdain as the lame-duck bank under its control.
PTSB expects some customers to pay for its past mistakes by charging them a variable interest rate of 5.19%. This subsidises the loss-making tracker mortgages that it has given two out of every three mortgage customers, with an average rate of just 2.25%.
Forcing a minority to subsidise the majority clearly violates the consumer protection code, which requires banks to act fairly in the best interests of all customers. Trackers are a problem for all lenders but, apart from PTSB, none of them has passed the bill to customers on variable rates.
These issues did not seem to trouble Brian Hayes, minister of state for public service reform, when he told the Dail on Tuesday that mortgage pricing was a matter for the banks to decide.
If this is so, why did the government force Allied Irish Banks (AIB) to cut rates last October, even though its mortgages were already the cheapest? Why was similar pressure placed on Bank of Ireland and Ulster Bank — but not PTSB?
Hayes reminded PTSB’s customers that they had benefited from a big rate cut in December, but seemed to forget that they pay substantially more than customers of other lenders, despite the reduction. PTSB’s current rate of 5.19%, for example, compares with 3% at AIB, 3.84% at Bank of Ireland and 4.75% at Ulster Bank. The British government is clearly a kinder paymaster.
The government’s defence of PTSB descended into farce on Wednesday when no ministers or TDs from the ruling coalition bothered to turn up as the mortgage debate resumed.
In the face of such indifference, PTSB’s customers are powerless. They cannot move elsewhere if they are in negative equity. Even those whose homes are worth more than their mortgages are trapped because more competitive lenders accept only the most creditworthy applicants. To rub salt in the wounds, PTSB is advertising variable mortgages at 3.69% — but for new customers only.
Government sources hint that the solution lies in ridding PTSB of its troublesome trackers, so the bank would have no excuse for robbing Peter to pay Paul. Customers will believe it when they see it.
Negative response
Mortgage customers of Permanent TSB took their campaign for a fairer deal to the Dail last week — only for the government to treat them with the same disdain as the lame-duck bank under its control.
PTSB expects some customers to pay for its past mistakes by charging them a variable interest rate of 5.19%. This subsidises the loss-making tracker mortgages that it has given two out of every three mortgage customers, with an average rate of just 2.25%.
Forcing a minority to subsidise the majority clearly violates the consumer protection code, which requires banks to act fairly in the best interests of all customers. Trackers are a problem for all lenders but, apart from PTSB, none of them has passed the bill to customers on variable rates.
These issues did not seem to trouble Brian Hayes, minister of state for public service reform, when he told the Dail on Tuesday that mortgage pricing was a matter for the banks to decide.
If this is so, why did the government force Allied Irish Banks (AIB) to cut rates last October, even though its mortgages were already the cheapest? Why was similar pressure placed on Bank of Ireland and Ulster Bank — but not PTSB?
Hayes reminded PTSB’s customers that they had benefited from a big rate cut in December, but seemed to forget that they pay substantially more than customers of other lenders, despite the reduction. PTSB’s current rate of 5.19%, for example, compares with 3% at AIB, 3.84% at Bank of Ireland and 4.75% at Ulster Bank. The British government is clearly a kinder paymaster.
The government’s defence of PTSB descended into farce on Wednesday when no ministers or TDs from the ruling coalition bothered to turn up as the mortgage debate resumed.
In the face of such indifference, PTSB’s customers are powerless. They cannot move elsewhere if they are in negative equity. Even those whose homes are worth more than their mortgages are trapped because more competitive lenders accept only the most creditworthy applicants. To rub salt in the wounds, PTSB is advertising variable mortgages at 3.69% — but for new customers only.
Government sources hint that the solution lies in ridding PTSB of its troublesome trackers, so the bank would have no excuse for robbing Peter to pay Paul. Customers will believe it when they see it.