AIB How is AIB calculating the interest on the 12%?

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In round figures

Karen's mortgage was €300k
She paid her monthly repayments - they are factual.
Her mortgage should have been €264k - i.e. 12% less.

In year 1, they charged her say 5% of €300k or €15k interest.
They should have charged her 5% of €264k or €13,200

So they overcharged her €1,800

In year two they charged her interest on the €36,000 and on the €1,800

AIB is arguing that they only charged her interest on the €36,000.

I don't get it.

Brendan
 
Thanks October - when i take col E out as mentioned above - the calculation comes out close to the penny of the interest refund received today.

Rob
 
Brendan Burgess said:
In round figures

Karen's mortgage was €300k
She paid her monthly repayments - they are factual.
Her mortgage should have been €264k - i.e. 12% less.

In year 1, they charged her say 5% of €300k or €15k interest.
They should have charged her 5% of €264k or €13,200

So they overcharged her €1,800

In year two they charged her interest on the €36,000 and on the €1,800

AIB is arguing that they only charged her interest on the €36,000.

I don't get it.

Brendan
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Looks like it, the mind boggles!!
 
Brendan Burgess said:
This is the extract from the Ombudsman's decision

b) repay the Complainant, to an account of her choosing, the difference between (1)
the amount of interest she actually paid from 30 April 2010 to date, and (2) the
amount of interest that she would have paid on the reduced (written down) capital
balance from 30 April 2010 to date.

I really can't see how that can be interpreted any differently.
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To add insult to injury AIB are insisting on sending everyone a cheque. I called last week to see if I could get the interest refund lodged into "an account of my choosing" and I was told no, cheque only......
 
Brendan it’s Looking like we all got a lower amount on our cheques my fixed rate ended 3/4/2012 mortgage of £231-378
Mortgage reduction of €27-765 Refund today of €8452 I had €9345 from the calculator any possible reason for this I don’t get it .
 
Since AIB used compound interest when working out our mortgage repayments they should have done the same for the refund. Putting the customer first as usual. Something else to add to the FSPO case I suppose. I can only shrug at this stage :rolleyes:
 
How do you argue if you don’t feel you’ve received the right amount? I’m rubbish with figures so this is all completely out of my league!
 
Got Cheque today for €12300 and was expecting €11700 ballpark so looks like it was calculated properly. My write down in June was €35000
 
Got a call back from the helpline and they confirmed it was simple interest and based this on the fact the 12% was a static amount and did not change o_O I explained that it was in fact compounded as it was part of the principal of the mortgage and they submitted a complaint on my behalf probably unnecessary given Brendan has been in communication with them but I wasn't accepting their explanation so the agent opened the complaint so he could end the call!
 
tnegun said:
Got a call back from the helpline and they confirmed it was simple interest and based this on the fact the 12% was a static amount and did not change o_O I explained that it was in fact compounded as it was part of the principal of the mortgage and they submitted a complaint on my behalf probably unnecessary given Brendan has been in communication with them but I wasn't accepting their explanation so the agent opened the complaint so he could end the call!
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I did the same but girl was adamant that the interest was on the static amount. I have a feeling AIB will stick to their guns on this one.
 
The more I think about this, the more stupid and frustrating it is.

Say that 10 years ago, I had a loan of €100k with 20 years left.

Someone else got a top loan of €10k but by accident they added it to my account. I didn't notice.

They then increased my repayments to amortise the full loan of €110k - again , I didn't notice.

Now, 10 years later they realise the mistake.

Surely it's clear that they owe me €10k compounded at the mortgage rate?

If it would help them understand and it answers Sadim's rhetorical question, when they get onto the other guy who has paid nothing on his top up, will they be charging him simple interest for the last ten years?

Brendan
 
Its really bizarre the agent was adamant that this was the FSPOs ruling and the bank is correct!
 
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