AIB Aib disputes 100 cases (update : 3,000 cases!)

[Brendan Burgess]

Hi Duke

In my humble opinion, a bank cannot set the price for something retrospectively. But you have a right to disagree. AIB may well wish to disagree as well.

I don't see the argument. But if there is one, then they should not cave in to anyone but they should send it to the High Court and fund Padraic Kissane or someone else to take a case. And they should agree to be bound by that case for everyone.



Brendan

 

[llgon]

When AIB wrote to me they apologised and said they should've offered me the Bank's prevailing tracker rate at 5.16% (ECB+4.91%). This was in February 2011 (after I came off a fixed rate of 5.2%). They're now offering me a "commercially priced" prevailing tracker rate of 3.67% (ECB+3.67%).

If I'm reading Dunned's post correctly AIB offered a prevailing rate in 2011. Maybe this is not the case?

 

[Duke of Marmalade]

Hi Duke

In my humble opinion, a bank cannot set the price for something retrospectively. But you have a right to disagree. AIB may well wish to disagree as well.

I don't see the argument. But if there is one, then they should not cave in to anyone but they should send it to the High Court and fund Padraic Kissane or someone else to take a case. And they should agree to be bound by that case for everyone.



Brendan

I agree with all that. But the "prevailing" rate is certainly not some historical rate. I'm afraid it would need some independent third party to interpret what it meant given that there was no longer any prevailing rate either at AIB or anywhere else.

 

[Sarenco]

But the "prevailing" rate is certainly not some historical rate.

Agreed Duke but are you sure you aren't reading additional words into the contract that aren't there?

The relevant clause doesn't say that borrowers can opt to roll to the prevailing new business tracker rate on the expiry of their fixed term. Obviously there were thousands of AIB customers that continued to benefit from trackers rates after October 2008 - they just weren't offered by AIB on new loans. Was the rate (or perhaps the weighted average rate) paid by those borrowers not the prevailing tracker rate at the relevant time?

I certainly agree that the prevailing tracker rate cannot be some random rate - historical or otherwise - that is simply picked off the wall.

 

[joe351980]

Yes should the wording of said, 'prevailing rate offered to new mortgages.

Would Prevailing rate not be a rate in existence.

Which could be the rate that was on offer at time of offer. That rate would still be prevailing.

 

[Neverever]

Lets not forget the prevailing rate only refers to the ECB rate. It does not pertain to the margin aspect of the tracker.

AIB's wording clearly states the ECB rate is variable, as such would be open to the prevailing winds of change.

However it makes no mention the margin in prevailing.

In fact clause 3.6.3 states the scenario in which a margin can be adjusted. There is only one scenario that can cause the margin part of the tracker to adjust. Thats an LTV change.
There is no other scenario that gives the bank the authourity to adjust the margin that was on offer at drawdown of mortgage.
The margin is not open to be classified as prevailing, it is fixed unless AIB revalue the house.

 

[Duke of Marmalade]

Lets not forget the prevailing rate only refers to the ECB rate. It does not pertain to the margin aspect of the tracker.

AIB's wording clearly states the ECB rate is variable, as such would be open to the prevailing winds of change.

However it makes no mention the margin in prevailing.

In fact clause 3.6.3 states the scenario in which a margin can be adjusted. There is only one scenario that can cause the margin part of the tracker to adjust. Thats an LTV change.
There is no other scenario that gives the bank the authourity to adjust the margin that was on offer at drawdown of mortgage.
The margin is not open to be classified as prevailing, it is fixed unless AIB revalue the house.

This seems to apply at new business stage. It does not preclude margins for new business rising in general.

 

[Neverever]

Yip I have AIB press releases from the time they stopped offering trackers to new business, and press release clearly advised they are stopping offering trackers to new business.

Those already drawn down with offers of trackers would not be impacted.

But we were.....

 

[Bob Minnion]

Hi all just looking for some advice my wife took out a mortgage before we got married in December 2008 with AIB first 24 months was interest only at a fixed rate on her mortgage agreement it clearly states she could have availed of the 3.2 clause in 2010 containing the 3 options of fixed , variable or prevailing tracker, she has to date not been included in any review but should she not have been offered a tracker option given it clearly states this in her mortgage agreement, if the bank had ceased to offer new business trackers in October 2008 then why was this option offered to her in December 2008, should this not have been removed from all of their mortgage contracts.

 

[Duke of Marmalade]

Hi all just looking for some advice my wife took out a mortgage before we got married in December 2008 with AIB first 24 months was interest only at a fixed rate on her mortgage agreement it clearly states she could have availed of the 3.2 clause in 2010 containing the 3 options of fixed , variable or prevailing tracker, she has to date not been included in any review but should she not have been offered a tracker option given it clearly states this in her mortgage agreement, if the bank had ceased to offer new business trackers in October 2008 then why was this option offered to her in December 2008, should this not have been removed from all of their mortgage contracts.

That's a very interesting situation if you have stated it accurately. It suggests a hold new meaning for "prevailing" to the effect of "if we have one" a meaning reinforced by the fact that they didn't have one "prevailing" at the time you took out the original. Why were the Fixed and SVR options not qualified by the word "prevailing".

As for advice, by all means climb on the bandwagon even though your original instinct was that you had not been cheated and you don't seem to have suffered any hardship.

 

[noproblem]

What would happen if the banks checked on the mortgage contracts of everyone now looking for compensation and found a lot of them had their mortgaged properties rented out in contravention of what was on their contracts? Are those same customers now entitled to compensation, or not? There's a hell of a lot of them out there.

 

[Bob Minnion]

Thanks for response , we just looked at her mortgage agreement yesterday evening and it is dated and signed the 8th of December 2008 and it clearly gives this option, we have decided to contact the bank and ask them, we where never offered a tracker option after the fixed period of 24months , surely if the bank had ceased offering trackers on the 10th of October 2008 then this option should have been removed from the standard offer of mortgage agreement contracts, instead she was clearly told in her mortgage agreement that she could avail of options a,b,c with option c being a prevailing tracker, would I not be correct in saying if the option of a prevailing tracker rate is offered in an agreement that they had an onus to the customer to continue to provide a prevailing tracker rate? even if AIB had no prevailing tracker rate at this time in 2010 could it be that the prevailing rate would be the average tracker rate on the market at this time.? She missed a few mortgage repayments and the harassment morning noon and night from the bank was shocking until we made up the payments. I myself have an Ulster Bank tracker currently awaiting my redress.

 

[Balfour]

Hi Bob

You need to contact AIB, based on your comments, you should be included in the review.

Please read the threads in the following

https://www.askaboutmoney.com/threads/aib-restoring-my-tracker-but-at-3-67.199391/

 

[Dunned]

Can anyone assist please? I've been in correspondence with AIB for over a year now. I received a letter dated 4th Oct saying the Central Bank has asked AIB to review all accounts and ours is included in this review. This will take several months, please be patient. I then receive a letter dated 10th Oct, which is a final response to my specific complaint. They give referral rights to the FSO. But they also say "we're continuing to look at accounts under the tracker mortgage review and this review is ongoing". We will write to you again to confirm our position. So why have they provided a final response if it's still being reviewed? Or has it been reviewed in the 6 days between the 4th and the 10th and I now need to go to the ombudsman?

 

[Banking17]

Pascal Donohue on Rte Radio 1 Marion Finacune

 

[moneymakeover]

@Dunned
Sounds like they have done their review and that's their conclusion
If you ask them they will confirm that's their position (in my opinion) but that if new information appears they will consider that while the review is ongoing
The final response is what you take to the ombudsman and raise a complaint

 

[Stitcher]

I would agree with Duke here. When I took out a Fixed rate previously and it came to an end, I had to choose either the SVR at the time the fixed rate finished or a selected number of other products offered. I always found that one of the risky elements of a fixed rate in that you never knew if rates would be better or worse after. If you were offered the option of the prevailing Tracker rate when the Fixed ended, but they did not exist anymore, then I would think that was that. I always thought a Fixed rate mortgage was really a short term one and then you choose the next option.

However, If you were on a Tracker already and fixed , and there was the understanding that your Tracker was still there at the end, that's different.

I'd love to get a lucky break from a bank. I have only ever had unlucky breaks. (SVR going down after fixing, discounted Tracker going to high rate after discount period.....)

Wonder what PK thinks of this group?

 

[Stitcher]

Mind you Reading through the posts on Balfour's link above, it looks like Fixed rate customers with a mention of a Tracker rate option may well be in for a lucky break, if the FSO case for the customer with a part fixed and part Tracker mortgage applies .
If banks made a mistake in not removing the Tracker word from contracts then they need to deal with it!!! We all have to learn from our mistakes!

So many different scenarios, it's hard to keep up.

 

[Balfour]

Hi Dunned
FYI, I received a final position from the bank 6 months ago, I received a letter on Wednesday last saying I am included in their review.
Not knowing any details of your case, you might yet get a letter telling you, you will be included in the review

 

[Neverever]

Realistically once your draw down docs mention Tracker, you should be able to avail of tracker for the entire lifetime of your mortgage. And that margin as was entitled to you at drawdown to be kept the same for the life time of the mortgage. The only thing that could move the margin was a change in the Loan To Value ration.

If you remember back to these days, 2007 - 2008. AIB were constantly pushing LIFETIME when they promoted their tracker offerings. Saying stuff like they (AIB) represent significant value over the life of the mortgage. Their trackers were for life. Constantly pushing the LIFETIME value of their mortgage. On of my favourite quotes from AIB was from , Head of Credit Products, AIB Bank who said

"We believe lifetime value is a key consideration for many mortgage customers. These new rates not only provide that, but have the added bonus of an additional discount for the first year of the new mortgage." They is taken from an article in 2007 can be viewed ob below link , just shows how AIB were selling this to us at th time. NeverEver a mention that trackers maybe be gone, of if we didn't take tracker from state of drawdown we would lose it. We were always told, at any point during the LIFETIME of your YOUR mortgage you can return to YOUR tracker at the same margin. No RISK
http://www.finfacts.ie/irishfinancenews/article_10008920.shtml

I have also attached screenshot of the press release from AIB October 10th 2008, when AIB removed the offering of trackers to NEW customers. You will clearly see from this that both
Existing customers with Tracker Mortgages and Customers who currently have an offer of a Tracker Mortgage, but which is not yet drawn, will still be able to avail of the Tracker Mortgage within the terms of their loan agreement.