Customers should boycott lenders who do not pass on cuts to existing customers

gnf_ireland said:
Threadser - I am not sure what your argument is here. Of course BOI will want to see an updated valuation to prove your property has a LTV of less than 75%. Otherwise they are either using old data (original valuation when you got your mortgage) or basing it on some index value.
I personally don't think this is an unreasonable ask, but maybe I am in the minority here
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I am also a variable rate mortgage holder. The issue I have is that the variable rate should have been reduced by at least .5 percent considering all the ECB rate cuts and the fact that the variable rate being charged by the bank is 2% above the EU average. It should not be be necessary for me to fix my rate in order to get this reduction. I have already closed 2 savings accounts with the bank and am seriously considering moving my current and credit card arrounts. I think they have shown scant regard for customers whose hard earned taxes provided the bailout.
 
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kbc cut their rate early Dec by 0.1% on LTV according to their website, but this does not seem to be passed to existing customer either
 
That's brilliant Joe-90, if everyone did that banks would learn. I moved my ac from AIB to PTSB when they started charging for it and have never regretted it. Come on people move from these banks!

On a further note I can't understand why it isn't easier to move mortgage ac. I move insurerers, esb etc. every year to get best rates - I'd love to move mortgage and as a person who has payed on the dot for ten years I feel I should be able to. I'mnot allowed though as it seems I don't have the correct criteria. My mortgage is with EBS and although they did lower their rates they are still overpriced and didn't lower as much as AIB even though they are basically the same bank. I feel stuck with them. The government should be doing more too I think.
 
I'm an existing PTSB variable rate mortgage holder. I called them yesterday to ask to change to the new business rate. They said that wasn't currently allowed. Maybe there's some hope in the use of "currently".
I'm fortunate enough that my LTV would allow me to switch, however, how do we know that once KBC has picked up the mobile business from PTSB and BOI that they won't increase their rates? Have they made any committments to maintaining that rate difference?
 
Threadser said:
The issue I have is that the variable rate should have been reduced by at least .5 percent considering all the ECB rate cuts and the fact that the variable rate being charged by the bank is 2% above the EU average. It should not be be necessary for me to fix my rate in order to get this reduction. I have already closed 2 savings accounts with the bank and am seriously considering moving my current and credit card arrounts.
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Hi Treadser - apologies. I understood from your original post you were complaining that you had to supply a new valuation at your own cost to get approved for a lower LTV rate. However if the complaint is more general relating to the cost of SVR, then I am 100% supportive of this. We all know the SVR in Ireland is too high, but without serious government pressure this is not going to change.

Threadser said:
I have already closed 2 savings accounts with the bank and am seriously considering moving my current and credit card arrounts.
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Closing accounts is the only thing banks understand, and even then it takes massive numbers of them to be seen at senior level where these decisions are made. The comment "seriously considering" is one that is used a lot - however, its actions that count. I closed everything with BOI 8 months ago (except my mortgage) because they charged me 16 euro in transaction charges in a single quarter for going below the 3k threshold for 1 day (inbound payment had been delayed by a day). I advised them I would close unless the charges were refunded immediately. They declined and I closed personal current, joint current and credit card the next day.
You can the phone call when Premier Banking rang me 2 days later asking me if I wished to use their services and told them I was no longer a customer over 21 euro!
 
Billy Baltic said:
how do we know that once KBC has picked up the mobile business from PTSB and BOI that they won't increase their rates? Have they made any committments to maintaining that rate difference?
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No such guarantee exists, the same way no such guarantee exists that the other banks won't drop their rates below KBC's in the future. All anyone can do is what is best for them at a point in time.

If BOI offered me the 3.9% rate (<60% LTV), I would probably have stayed with them. Moving mortgage is a hassle to obtain all the paperwork etc, especially when self employed like myself. I had been holding off to see how BOI would react to the AIB move, but sadly it was not as expected. The best I can do for myself now is to try and move to KBC and hope they behave no worse than the other banks. In 6 months time, a bank might offer 3.2% - who knows !
 
Brendan - how many customers do you think would need to move there mortgages by 31st March 2015 from either PSTB or BOI to get them to review their policies ? Do you believe it would take 100 or 1,000 or 10,000 or how many (roughly)? and how realistic is it for that to happen given how slow people are to move current accounts or credit cards and they are much easier to do with no associated costs
 
gnf_ireland said:
No such guarantee exists, the same way no such guarantee exists that the other banks won't drop their rates below KBC's in the future. All anyone can do is what is best for them at a point in time.
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While true, the problem is there's a cost involved in moving. So if you move you need a period of time (several months) where there is a rate difference or you could end of losing money on the switch.
 
Billy Baltic said:
So if you move you need a period of time (several months) where there is a rate difference or you could end of losing money on the switch.
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Absolutely - and you need to be getting a decent difference in rate to switch. Moving for 0.3% or even 0.5% could mean a long pay back period.
If the gaining bank offers you an incentive to move, there will also be claw-back on those as well no doubt

So while its easy to say switch mortgages, people do have to make sure they have all the analysis done. If I move to KBC to 3.55% and BOI create a new LTV rate of 50% for new and existing mortgages of 3.8% a week later, it would mean I have a much longer pay back period.
 
Brendan Burgess said:
But if you don't move to KBC, then BoI won't do anything for the existing mortgage holders
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Absolutely. This was why I was curious and asked how many people you think would need to switch mortgages before the likes of BOI take note of them ?
gnf_ireland said:
Brendan - how many customers do you think would need to move there mortgages by 31st March 2015 from either PSTB or BOI to get them to review their policies ?
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Brendan Burgess said:
If you tell them that you are moving to KBC, I suspect that they will cut you a deal, as they did for Carmel
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I am not sure how Carmel managed this to be honest. I have tried the approach twice at this stage and had absolutely no luck - once directly via the mortgage team and secondly via the Premier Banking team. In both scenarios the only thing they would offer me is a Fixed Rate for LTV <75%, moving back to a 4.3% rate (or maybe it was 4.2%), once the fixed term had expired.

On both occasions I reminded them of the original valuation which is on the system, and of the current mortgage amount and confirmed even on a 2011 valuation the LTV was currently below 60%.


At this stage in the process, I have the complete mortgage application ready for KBC (redone as a joint application), and answered all of the questions they have asked me based on the paperwork supplied, so there is no reason not to at least proceed with the application. If KBC accept the application, then there is no reason that I can see that I would not switch it. Based on my figures, I will be cost neutral in just over a month once I factor in legal fees and the free home insurance.

As I see it, in the short term the best BOI will do is let existing customers avail of the 3.9%, and as most of us believe there appears to be the start of a 'price war' commencing. It is highly likely that KBC will be more aggressive in this than BOI, especially if BOI are under pressure to pass lower rates on to existing customers as this could seriously hurt their existing margins. Their existing mortgage book is much higher than KBC's obviously and they should have higher numbers of people on lower LTV's due to the duration of their engagement in the mortgage market. Maybe I am wrong on this, and would be interested in others views on how this 'price war' will evolve. As it stands BOI are still offering less than AIB and KBC and then announced their rates after the others had done so.

Sadly those on high LTV's, including negative equity mortgages, will continue to be penalised for a while to come.
 
Hi gnf

Hopefully your move to KBC will go as planned. When it is completed, it would be great if you could do a case study/diary.

This will motivate others who may just not get around to it.

Your posts on AAM will be a handy diary, but it would probably be no harm to keep an actual diary. For example, your current thoughts towards BoI's offer of fixed rate, and your thoughts that while KBC are cheaper now, maybe some other bank will be cheaper if the mortgage war escalates.

Brendan
 
Hi Brendan

Happy to do so - even just to say thanks for all the assistance on here. It comes with the usual health warnings that they would be my own thoughts and opinions and no guarantee that they will actually work out like that. I have no crystal ball or I would not need to be looking for a mortgage !

My personal financial situation is quite different to most peoples I would imagine. I am happy to provide generic numbers in terms of LTV and salary/savings against mortgage amounts requested etc if that assists in any way. Alternatively I can keep the majority of numbers out of it !

Let me know what you think and happy to send you a draft before putting it up here
 
gnf_ireland said:
I am happy to provide generic numbers in terms of LTV and salary/savings against mortgage amounts requested etc if that assists in any way.
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Thanks gnf


That would be very important. The LTV and interest rates are crucial. I presume that salary is only important in the sense that you either meet the Loan to Income ratio or you don't.

Brendan
 
I don't understand why you are calling for a boycott of banks which offer lower rates to only some borrowers and not those which are fleecing all customers (ie Ulster Bank), surely they should be a bigger target?

I think your campaign is admirable btw :)
 
Central bank is letting us down again by allowing this to happen....when I was in UK I had mortgage with HSBC who had discriminatory sets of SVR tor new and existing customers I complained and got nowhere however someone went to UK ombudsman and won. As a result HSBC were forced to refund acouple hundred million to customers

This is from 2002!!! No UK bank would dream of trying this as the ombusdman decision cost them almost 2 billion at the time
 
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KBC are at it too and plan so screw existing customers. So it's really only worth moving to aib, as your going to be paying over the odds with Kbc when they cut rates again.

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