IIB upped rates on tracker mortgage after issuing Letter of Offer

S

Serenn

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Hi All,

just wanted some opinions on this.

We got our Letter of Offer before Christmas from IIB Homeloans.
The purchase is only concluding this week due to legal technicalities that took some time to sort out.
I got a call from my broker saying that the IIB had raised their rates on 2nd Jan (difference of 0.35%) after issuing our original Letter of Offer and they were now going to issue a new Letter of Offer at the increased rate to our solicitor for us to sign.

Has this happened to anyone else out there?
If so, do we just have to accept it?

Serenn.
 
Is this the same IIB who issued a Press Release earlier in the week, and had Chief Economist Austin Hughes on every radio/tv show, saying how the ECB were going to lower rates by .75% by the end of the year?

And the same IIB who have a record number of respossion orders in the courts at the moment?

Personally I would avoid.
 
IIB reserve the right to increase rates from Loan Offer to Completion as has happened.

This should be on the loan offer, if you check

J
 
They are within their rights to do it. Shop around and make sure you are getting the best deal with the new rate and tell them you will be moving. You might be surprised to see them stick to the old rate. Don't be put off by the work involved in changing mortgage providers at this stage. Its not that big a job so if you get a better rate elsewhere that IIB won't match just move.
 
Hi All,

thanks for the replies.
I never liked going with IIB to begin with, but they were the only ones who would give us a mortgage.
Not because we're a bad risk, (we sold our house and both have good salaries) but because of what we're buying.
We're buying a 30 acre residential farm (house not habitable) and none of the other banks had any interest in that deal at all.
The sale has been dragging on since August, when our bid was accepted, so delaying closure further by switching mortgage providers would not be good.
It looks like we will just have to take it up the tail pipe. :-(

Serenn.
 
As mentioned above all lenders will reserve the right to review the rate offered before final closure. In spite of some ranting earlier in this thread IIB are no different from any other lender in this respect.
 
For the limited numbers of people in the process of closing deals it's pretty bad PR by IIB. Take the deal on the table if you must but don't show any loyalty, reassess the best deal available within a year (most brokers include this in their service)
 
IIB are the only lender who will lend you the money. I think that deserves a bit of loyalty, its a bit rich of some posters to suggest that no loyalty is deserved. Remember, if it was not for them you would not be purchasing the property at all. They have taken a big chance on you as, if things don't work out they have an asset that, in general, is not overly easy to sell at the best of times.
I do not work for IIB by the way - just hate to see the way some people refuse to value a lender when they are doing someone a favour. Guess some of the younger posters here don't have any experience of "hard times"
 
clubsandwich said:
IIB are the only lender who will lend you the money. I think that deserves a bit of loyalty, its a bit rich of some posters to suggest that no loyalty is deserved. Remember, if it was not for them you would not be purchasing the property at all. They have taken a big chance on you as, if things don't work out they have an asset that, in general, is not overly easy to sell at the best of times.
I do not work for IIB by the way - just hate to see the way some people refuse to value a lender when they are doing someone a favour. Guess some of the younger posters here don't have any experience of "hard times"
Click to expand...

No offence but that is one of the more bizarre posts I have seen. So you think your bank is doing you a favour by giving you a mortgage??
 
if i was buying agri land and an uninhabitable house and i tried every other lender and was refused then, i would consider IIB as having been quite good to me - remember the security offered in this case is hardly gilt edged!
 
DerKaiser said:
Take the deal on the table if you must but don't show any loyalty, reassess the best deal available within a year (most brokers include this in their service)
Click to expand...

Given that broker commissions get clawed back if a loan is moved to another lender within 3 - 5 years depending on the lender, I'm surprised to hear this. It's not a practice I had come across. Can you tell me how it works?
 
clubsandwich said:
if i was buying agri land and an uninhabitable house and i tried every other lender and was refused then, i would consider IIB as having been quite good to me - remember the security offered in this case is hardly gilt edged!
Click to expand...

Let's not be naive enough to think that any of the financial institutions are out there doing people favours. IIB obviously have assessed the risk and are comfortable with it, otherwise they would have refused a mortgage also.

You are not tied in to this mortgage so review the other institutions on a regular basis and feel no guilt if you find someone with a better offer down the line. I switched my mortgage recently from the EBS to NIB and it didn't cost me a penny; I will switch again if I see a better deal down the line. Healthy competition is good for the consumer. Don't believe that they are loyal to you in any instance.

Good Luck.
 
I presume that they can pay the clawed back commission from the commission they'll get on the new deal. Haven't been through the process but was told it was part of the service. It's in their interest to facilitate people to get a better deal rather than lose them entirely
 
Hi All,

just heard from my broker that because we returned the Letter of Offer before Christmas, they are letting us stick with the old interest rate.

A happy ending!

Thanks for all your replies,
Serenn.
 
DerKaiser said:
I presume that they can pay the clawed back commission from the commission they'll get on the new deal. Haven't been through the process but was told it was part of the service. It's in their interest to facilitate people to get a better deal rather than lose them entirely
Click to expand...

But if they do this after a short period of time, e.g. a year, the bulk of the commission on the first mortgage will be clawed back and then they'll get paid again for the second. So they'll have processed two mortgages and got paid little more than for one. I'd expect that your mortgage would need to be fairly substantial for this to be a workable proposal. What happens if the same client comes back year after year?

Given that most lenders cease to claw back after three years, I could see a workable model where the broker will review after three years.
 
I assumed it was common practice based on the literature I received recently from the broker that processed my mortgage but i guess customer inertia is a big factor. If I noticed after a couple of years I could save on my mortgage interest rate I'd ask my broker to find me the best deal available at that point. The way I figure is that they'd be out of pocket if I moved it myself.
 
It's certainly an interesting angle. Make the offer initially as it would certainly encourage client retention and loyalty, but gamble that inertia will keep sufficient numbers of your overall book of business from actually taking up your offer, so clawbacks don't become an issue. I'd say you have a shrewd broker. :cool:
 
I take it you don't offer your clients the same service Liam?
 
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