# How did people actually "lose" their tracker mortgages?



## Joeber (4 Nov 2019)

How exactly did people lose their tracker mortgages? Did they fall down the back of a couch in the bank! 

Surely if they were on a tracker of ecb +xx and that was better than either the fixed or variable rate at the time, they would not have voluntarily switched to a different rate?

Now, I'm not a financial expert but I'd imagine that if a banking official said to me, hey Mr. Gullible, currently on your tracker rate your mortgage repayment is €900p/m but how would you fancy going on to a fixed rate for 3 years and your repayments will only increase to €1400p/m... I think I would be savy enough to not take him up on that tempting offer!

And surely if the bank wanted to switch the customer onto a different rate they would need signed contracts by the customer?

So how did people end up on higher rates without consent?

Also, the media stated in many articles that some people were 'entitled' to be on tracker rates but were on fixed or variable. How would any customer be entitled to be on a tracker rate if it was totally at the banks discretion to offer tracker rates?


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## NoRegretsCoyote (4 Nov 2019)

I've never fully understood this . It's never been addressed in the dozens of articles I've read on the topic either.

I spent ten minutes looking through Central Bank updates on the tracker issue and there's no explanation there either.

It seems odd that tens of thousands of people failed to claim something that they were entitled to.

Someone in the industry told me that in general mortgage contracts didn't allow for a tracker, but the Consumer Protection Code (CPC) obliged banks to offer it to customers, but they never did.

Would be happy if someone could clarify though.


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## moneymakeover (4 Nov 2019)

What happened was
At onset of the financial crisis, people on tracker looked for certainty by taking the fix option within the tracker contract

Remember Trichet raised rates about 10 times

People felt under pressure with large loans so they fixed for eg 3 years

Next the banks discontinued trackers for new customers

When the 3 years was up the individuals looked to go back on tracker

The banks said "tough",  "that option does not exist"

Thus began the tracker scandal


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## NoRegretsCoyote (4 Nov 2019)

moneymakeover said:


> Next the banks discontinued trackers for new customers
> 
> When the 3 years was up the individuals looked to go back on tracker
> 
> The banks said "tough",  "that option does not exist"



That doesn't answer @Joeber 's question though.


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## Brendan Burgess (4 Nov 2019)

Here is a summary of cases I did in 2011! 





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						Key Post - Did you lose your tracker when fixing your mortgage or breaking out of a fixed rate?
					

This is a quick summary of the issues relating to switching from fixed rates to trackers and a list of threads on the topic.       I will format it better later.        You may be contractually entitled to a tracker at the end of your fixed rate period   Check your mortgage agreement or the...



					www.askaboutmoney.com
				




There were other reasons since then.

I thought that one of the Central Bank reports broke it down into cohorts, but I may be wrong. 

Brendan


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## Brendan Burgess (4 Nov 2019)

I think it's important to realise that no one who started on a tracker and did nothing, lost their tracker. 

To lose their tracker, the borrower had to do something and "switching" from a tracker to fix their mortgage rate was the most common.

Brendan


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## Joeber (4 Nov 2019)

So what about people who were "entitled" to be on a tracker mortgage? 

Where does that come into it?


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## Nutso (4 Nov 2019)

At the end of their fixed rate period, they were entitled as per the terms of their contract to revert to a tracker, however a lot of banks said that that option no longer existed.


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## NoRegretsCoyote (4 Nov 2019)

Nutso said:


> At the end of their fixed rate period, they were entitled *as per the terms of their contract *to revert to a tracker, however a lot of banks said that that option no longer existed.



Not for all of the cases. As @Brendan Burgess wrote



> *If the document changing to the fixed rate did not specifically say that you would lose the tracker, you have a good case.*
> The Financial Services Ombudsman ruled in one case that the lender must give a tracker at the end of the fixed period, if the documentation did not specify otherwise.
> 
> *If the lender did not explain the implications of switching from a tracker to a fixed rate, you may have a case*
> Most switches from a tracker to a fixed rate did not give a right to return to a tracker. However, if the bank proactively encouraged you to switch without telling you the implications, you may have a case. Complain to the lender and go to the Ombudsman if you don’t get satisfaction.



It would be nice to see a statistical breakdown of where the banks reneged on a clear contractual commitment, and where there was ambiguity or where the contract was silent.


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## notabene (4 Nov 2019)

Inquired about fixing as rates went up several times in a few months between Dec 05 and June 06 as was on contracts in work

- was told by bank and broker that the mortgage would automatically return to the tracker rate at the end of the fixed period - checked specifically with broker, bank and read the mortgage contract before fixing as I was aware of the value of it

-mortgage contract indicated similar as there as a clause saying that the rate was for the life of the mortgage - no new documents were issued when fixing other than the fixed rate sheet

- no content with in the contract specifying you would lose the rate if you fixed or if in fact any alteration was made

-only cited that a beneficial rate (.85 instead of .95) for having a specific bank account would be lost if account was closed and would revert to .95 rate

-fixed period ended, financial crisis was in the offing and bank refused to give it back & tried to change the meaning of the terms

-simple as that - fspo later ruled in my case tracker was default rate in the contract


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## Trackman (4 Nov 2019)

Brendan Burgess said:


> I think it's important to realise that no one who started on a tracker and did nothing, lost their tracker.
> 
> To lose their tracker, the borrower had to do something and "switching" from a tracker to fix their mortgage rate was the most common.
> 
> Brendan



I did nothing and lost my tracker. 

Never went fixed or switched banks.


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## Brendan Burgess (4 Nov 2019)

Trackman said:


> I did nothing and lost my tracker.



Your case seems unusual




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						AIB - AIB has calculated the refund on tracker from the wrong date!
					

Hi  while preparing appeals pack I only noticed how the bank calculated interest overcharge. I had fixed in May 2008 for 2 years at 4.85 per cent  but in financial summary they have also calculated interest over payments from  April 08 to March 18.  1. Has Bank made mistake as mortgage was fixed...



					askaboutmoney.com
				




AIB claimed that your contract did  not entitle you to a tracker and were put on one by mistake.  So they put you on the SVR but without telling you.

But it underlines how many different types of case there are.

Brendan


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## Trackman (4 Nov 2019)

Brendan Burgess said:


> Your case seems unusual
> 
> 
> 
> ...



When admitting fault they contend they didn't act on a tracker application provided by an authorised broker(2006) thereby placing us on a SVR from draw down.

For the OP the confusion on our side came from our broker who originally stated we would start on a discounted tracker for a period of 1 year and revert thereafter.

The broker did not advise us correctly at the time.

The tracker application stated we were to remain on a tracker for the life of the loan @ xx above the ECB rate.

NB. The bank had the tracker application on file from 2006 or down the back of their couch


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## Brendan Burgess (4 Nov 2019)

Brendan Burgess said:


> I think it's important to realise that no one who started on a tracker and did nothing, lost their tracker.



My point stands. There is a widespread view that the banks just took people off trackers.  Everyone who had an ordinary tracker contract and did nothing stayed on their tracker. 

To lose the tracker some action had to be taken. 




Trackman said:


> I did nothing and lost my tracker.
> 
> Never went fixed or switched banks.



I am completely confused. Now you are saying that you were on SVR since drawdown? 

Brendan


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## Trackman (4 Nov 2019)

The bank stated after examination that we were on a SVR from drawdown but we were not. They switched us to a SVR in 2008. 

Our payment records prove this. 

My point is we did nothing and ended up being transferred onto an SVR with no prior agreement or documentation to instruct the bank to do so.


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## Hopeful77 (5 Nov 2019)

There was ambiguity in the wording of a number of mortgage contracts too. When the fixed rate period was over it sometimes said they would revert to the 'prevailing rate at the time'. It didn't specify what time and now it's being said that could mean at the time of fixing in when the tracker mortgage rates were still available rather than prevailing being at the end of the fixed term when the tracker mortgage rates were gone.


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## MichelleSinead (6 Nov 2019)

I never really "lost" my tracker as I took my mortgage on a fixed rate, however when that fixed rate finished, I should have been offered the tracker rate.
I don't fully understand this myself and hence why when the tracker "scandal" came out I checked my mortgage paperwork, saw nothing about a tracker and filed it away as someone who was not affected. 
In March of this year the bank wrote to me to tell me that I was affected because they didn't offer me the option of the tracker when my fixed rate ended. I still don't understand this fully, the tracker mortgage was no longer an option when I finished the fixed rate but I can only assume because it was an option when I took the mortgage  that's why I am deemed as "affected"


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## MangoJoe (6 Nov 2019)

I clearly remember seeing promotional leaflets that were being heavily marketed/promoted/circulated by the banks at the time.

The one that stuck in my head was a posed photo of a stereotypical supposedly "Irish" family made up of very attractive, Icelandic looking models.

They were in a sunny park and gazing wistfully into the blue sky where the Banks cynical marketing team had super-imposed cheerful looking buzz words in little graphic bubbles:

"Fix Now" "Security" "Peace of Mind" "Certainty" etc etc.

These people had no moral compass and no shame, thankfully they're not still out merrily making hay in our communities.


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## elcato (6 Nov 2019)

MangoJoe said:


> I clearly remember seeing promotional leaflets that were being heavily marketed/promoted/circulated by the banks at the time.
> 
> The one that stuck in my head was a posed photo of a stereotypical supposedly "Irish" family made up of very attractive, Icelandic looking models.
> 
> ...


Sorry. If you're trying to make a case for the banks knowing that trackers were going to be so valuable then they would have given them up long before 2008. The main shame and cause of the tracker debacle was because of their action in moving away from the traditional SVR rate being between 1% and 2% above the central bank rate. Chances are no-one would have caused much grief if they had kept them at reasonable rates.


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## Foxy007 (14 Nov 2019)

For those of you who think people were choosing fixed for security, please think again. Our contract was certainly not presented as a tracker contract when we took it out........ thus we were unaware that it was a valid option / choice in very tiny print, which didn't clearly state tracker. Fix or Variable were the options presented to use in our offer letter. That is how a lot of people "lost" their tracker entitlement. The Banks write the contracts...present you with the contracts and their offer letter informing you of your options and you sign them. Unfortunately we've swung from being a country where we trusted the banks to manage our financial dealing with old school ethics to a modern system which is buyer beware basically.


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## Confused83 (16 Nov 2019)

Can I ask for people who's contract didnt clearly start tracker what it did say? I was under the impression the contract had to specify tracker as an option after the end of the fixed rate period.


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## john_mcm (17 Nov 2019)

In my case I took out my mortgage on a tracker rate with Ulster Bank in early 2007. I fixed later that year because of rising interest rates for 2 years. Came out of the fixed rate in 2009 and trackers had been withdrawn from the market so the bank would not give me the tracker back. I reverted to the standard variable rate. As far as I am aware it does not state in my contract that the tracker rate was or was not for the life of the loan or that any changes I make would alter the terms and conditions. The fixed rate letter I signed stated that on expiry of the fixed rate the "Ulster Bank Home Loan Rate shall apply as originally accepted by you in your letter of offer". It did not specifically say this was a tracker or a variable rate. We are still fighting the bank to get the tracker back. We are saying that the above applies to the tracker as this was the only rate that was mentioned in our contract and the bank is saying that the above statement refers to a variable rate so we should not get the tracker back. The complaint is currently with the ombudsman with questions currently going back and forth with ourselves and the bank. Not sure what the outcome will be but hopefully it will fall on our side.


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## Dpdp01050842 (17 Nov 2019)

That’s actually a joke that Ulster are contesting that. IMO 100% the Ombudsman will side with you and give significant compensation. Unless the above is missing information that would make me think otherwise


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## john_mcm (17 Nov 2019)

Dpdp01050842 said:


> That’s actually a joke that Ulster are contesting that. IMO 100% the Ombudsman will side with you and give significant compensation. Unless the above is missing information that would make me think otherwise


Thank you. I hope you are right because it has been a nightmare trying to deal with the bank on anything. Definitely no info missing but for some reason Ulster Bank are digging in their heels. At this stage it has been so long that I just want an answer and move on whatever the outcome is because it has taken over our lives. Hopefully we are coming out the other side at some point in the near future.


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## Brendan Burgess (17 Nov 2019)

john_mcm said:


> "Ulster Bank Home Loan Rate shall apply as originally accepted by you in your letter of offer". It did not specifically say this was a tracker or a variable rate.





Dpdp01050842 said:


> IMO 100% the Ombudsman will side with you



You cannot say that the Ombudsman will be 100% on this. 

Based on the limited information given by MCM, you can express your opinion that he should get a tracker rate and I would agree with you. But it's about 50/50 and not 100%.

Is the Ulster Bank Home Loan Rate defined in the contract? 
Does the contract say "If you fix your rate you will not be offered a tracker on expiry of the fixed rate but will go onto the Home loan Rate"?

The lenders have conceded about 40,000 cases. They presumably believe they have good grounds for not conceding the rest.

We would have to see Ulster's defence to mcm's complaint to make an assessment any higher than 50/50

I have been given a summary of a couple of cases where I could not believe the lenders' attitude. Than on reading the full story in  the documentation, it turned out that the lender was fully justified in their position.  And of course, I have seen other cases where the banks were obstinate and the Central Bank or the Appeals Panel or the Ombudsman forced them to change tack.

Brendan


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## john_mcm (17 Nov 2019)

Brendan Burgess said:


> You cannot say that the Ombudsman will be 100% on this.
> 
> Based on the limited information given by MCM, you can express your opinion that he should get a tracker rate and I would agree with you. But it's about 50/50 and not 100%.
> 
> ...


Hi Brendan,

I agree that the outcome is not 100% guaranteed and in fairness to @Dpdp01050842 did mention that the information I supplied may be missing some information which may impact his opinion. I also wasn't taking anything said as fact.

Regarding the banks defence they are basically saying that we were aware of what rates would apply throughout the customer journey and are also relying on condition 14c subsection ii of the banks mortgage terms and conditions that states that what will apply on expiry of a fixed rate is the banks SVR. 

We are disputing this based on the fact that our original contract and letter of offer only mentions the tracker rate we originally signed the contract on and nothing else, the banks mortgage advisor at the time told me that the fixed rate would revert to the tracker from our original contract ( I know that that isn't worth much) and also the condition they are referring to relates to new mortgages taken out on a fixed rate and does not mention anything about existing tracker rate mortgages and finally the fixed rate authority we signed in 2007 only states that on expiry of said fixed rate the "Ulster Bank Home Loan Rate Shall Apply As Originally Accepted By You In Your Letter Of Offer" The only rate mentioned in our original letter of offer is the tracker rate ECB + 0.75%. It does not define anywhere else in the contract or their terms and Conditions that the Ulster Bank Home Rate is anything else. The bank has also acknowledged that the fixed rate authority had an error in it directing us to an unrelated term and condition 2 and have offered €350 by way of compensation for this error. We believe the bank is trying to apply their narrative to the documents rather than what really happened. I am not sure if that clarifies anything further or not but at the moment questions are going back and forth between us through the ombudsman so we will see what the outcome is soon enough.


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## Bikini Widow (7 Dec 2019)

One overlooked element of this scandal was the influence of the media at the time.  

One of the triggers for me looking to fix back then was the repeated message from financial observers at the time that fixing was the best option.  I was still accountable for my actions but I clearly recall, media advice at the time having a clear influence on myself at least.  Not sure about others but to answer OP question I think certain quarters of the media played a part in influencing people like myself who were tight on money and looking to find any sort of stability. 

best wishes,
BW


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## B26354 (8 Dec 2019)

Bikini Widow said:


> One overlooked element of this scandal was the influence of the media at the time.
> 
> One of the triggers for me looking to fix back then was the repeated message from financial observers at the time that fixing was the best option.  I was still accountable for my actions but I clearly recall, media advice at the time having a clear influence on myself at least.  Not sure about others but to answer OP question I think certain quarters of the media played a part in influencing people like myself who were tight on money and looking to find any sort of stability.
> 
> ...


That push was not just coming from the media; EBS have admitted that pre economic crash they tried to “steer” customers towards taking fixed rates.


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## Thirsty (9 Dec 2019)

"..when that fixed rate finished, I should have been offered the tracker rate."

Same thing happened with me.

Have posted this before, but a credit to AAM is due here also. 

When trying to figure out best options from the list that was sent to me at the end of the fixed rate period (which list did not mention trackers); a poster on AAM recommended contacting bank and asking for their 'best rate'. 

This turned out to be 0.8% above ECB, and thats the rate I got.

Best phone call I ever made.


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