ptsb has dropped their fixed rates for new customers. Existing customers can't fix

tommyryan55

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PTSB seem to have dropped some of their fixed rates:
upload_2016-7-15_20-2-57.png
 
As you can see, this is only for new business.

The Central Bank should get stuck in here.

They are not offering fixed rates to existing customers, because of the wording of their tracker contracts which say something like "on expiry of the fixed rate you will get your tracker back". So someone who properly lost their tracker could fix for one year and then reclaim their tracker.

Brendan
 
Hi Brendan

I'm not sure I understand this point.

Surely, PTSB's problem was that, at least historically, their fixed rate terms provided that borrowers would default back to their tracker (or the "prevailing" tracker) rate at the end of their fixed term?

I don't see any reason why an existing PTSB borrower couldn't fix today on the basis that they would default back to PTSB's SVR (or the relevant "managed" variable rate) at the end of their fixed term. Why would the fact that a borrower may have had a tracker at some point prevent them from agreeing a fix on this basis today?

What do you think the Central Bank should do?
 
Hi Sarenco

The ptsb wording is something like: "on expiry of the fixed rate you will get your tracker back".
A borrower gave up his tracker for some valid reason. Maybe at the end of a fixed rate period, he opted for the SVR.
ptsb has done nothing wrong, but the borrower has lost their tracker.

However, the wording of their mortgage agreement means that if they fix again, they are entitled to their tracker back. Most trackers had a specified margin e.g. ECB +0.7% in their contract.

So ptsb does not want these guys to fix as they will get their tracker back.

I think that the contract gave people tracker mortgages for the duration, while allowing them to fix for periods without losing their right to the tracker for the remainder of the period.

ptsb should allow these customers avail of this as it's in the contract.

The Central Bank should investigate this. If they feel that ptsb is not treating customers fairly, they should direct them to do so.

Brendan
 
Thanks Brendan but I still don't understand how the terms of a previous fix could somehow be "re-activated" by a variable rate borrower fixing today.

Take a borrower that starts off with a lifetime tracker. He initially fixes on the basis that he can default back to his tracker rate on the expiry of his fixed term. He subsequently takes another fix, except this time he has no contractual entitlement to defalut back to a tracker so he rolls on to a managed variable rate on the expiry of the second fixed rate term. If he fixed again today (for a third time), I don't see how the terms of his first fix are in way relevant.

I suspect that PTSB has simply decided that they don't want to compete with BOI in the fixed rate market. I don't see how "fairness" comes into it - that's just a strategic decision by a lender in a competitive market. If a borrower doesn't like the terms on offer, then they are free to refinance their loan with another lender.
 
But they are competing in the fixed rate market just excluding their existing customers.

Also not everyone is free to switch, when we took out our mortgage in 2013 all the main banks would of lent to us, move on a few years with two job changes and two children and we are stuck with ptsb.
 
Hi tommy

Why are you stuck with PTSB? If you took out your mortgage in 2013, you must have significant positive equity built up at this stage given house price rises over the last few years. Is it an affordability issue?

I really don't understand why PTSB don't allow existing customers to fix - have they offered you an explanation?
 
He subsequently takes another fix, except this time he has no contractual entitlement to defalut back to a tracker

According to the mortgage contract, he is always entitled to opt for a tracker after any fixed rate period. He doesn't give it up by fixing.

Brendan
 
According to the mortgage contract, he is always entitled to opt for a tracker after any fixed rate period. He doesn't give it up by fixing.

Brendan

Well, if that's the case why doesn't he look for his tracker back today? I thought you said he would have given up his tracker for some valid reason?

Are you saying that there is a cohort of PTSB borrowers that opted to give up their lifetime trackers in favour of some other variable rate without having ever fixed? If that's the case then surely that amends the original mortgage contract?
 
Hi Sarenco

Johnny started with a tracker of ECB +0.7%
He fixed for two years.
At the end of the fixed period he was offered a choice of his tracker or a SVR. He chose the SVR.
He is now paying 4% when he could be paying 0.7%.
His contract says that he is entitled to his tracker at the end of any fixed rate period.
So he has to fix for a year to "resurrect" that condition.

Brendan
 
Hi Brendan

Ok, so Johnny agrees to pay an SVR without waiving, amending or varying his contractual right to revert to his tracker at the end of a fixed rate period. Well, a fixed rate period has already ended or expired (his first fix) so why can't he look for his tracker back today?

I still don't see how fixing again "resurrects" his right to revert to a tracker.
 
Hi Sarenco

I can't remember the actual wording, but it was fairly clear that the choice must be made on the expiry of a fixed rate contract. If your contract expired a couple of years ago, you don't have that option now.

So you have to fix again.

I sense that you don't believe me? Unfortunately, I don't have the wording.

It always did surprise me why ptsb didn't quote fixed rates for existing customers or quoted rates of around 7%. That makes no sense. All the other lenders like their customers to fix as it keeps them tied to them.

Brendan
 
Hi Brendan

It's not a case of not believing you - I'm just trying to understand the point.

I'd love to see the relevant contract wording but I would be surprised if the exercise of any existing contractual right to revert to a tracker on expiry of a fixed term was subject to a time limit.

I share your surprise that PTSB don't offer any fixed rates at all to existing variable rate customers. Makes no sense to me either.
 
Hi tommy

Why are you stuck with PTSB? If you took out your mortgage in 2013, you must have significant positive equity built up at this stage given house price rises over the last few years. Is it an affordability issue?

I really don't understand why PTSB don't allow existing customers to fix - have they offered you an explanation?


Hello Sarenco,

Based on a valuation last September my LTV is 57%. I live in Tipperary so house price rises have been more modest.

Is it part affordability due to creche costs although I am able to pay €800 a month on a mortgage of €420. The main reason I cannot leave PTSB is that my wife moved to the Civil Service last May which came with a 12 month probation period, due to 38 weeks off due to maternity leave this period will not expire unit next February.

Regards

Thomas
 
Thanks Thomas.

It sounds like you will be an ideal candidate for a switch as soon as soon as your wife's probation period expires - I wouldn't be looking to fix at this stage if I was you.

It doesn't sound like affordability will be an issue if you are currently in a position to overpay your mortgage to that extent.

According to MyHome.ie, asking prices for 3-bed semis have increased by 12.85% in Tipperary over the last 12 months so you might already be under 50% LTV at this stage. EBS and AIB offer fairly good deals for switchers at low LTVs.

I think it would be worth putting the switching process in train in the coming months so you are in a position to pull the trigger at the earliest possible opportunity.

Hope that helps.
 
Still fairly crappy rates

Hopefully AIB will undercut the market again soon and put more downward pressure
 
I can confirm existing ptsb customers are not allowed fix. I rang. Im on MVR of 4.3%

Basically existing customers of ptsb fund the bank. If your on a tracker and fair play if you are you pay at least 300 less a month for than a variable 200k mortgage.

I told the person on phone that im switching the minute my account goes out of negative equity. Im currently 20k negative.
 
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