KBC allows mortgage holders to redraw overpayments - is this still available?

To be fair the "Flexible Repayment Instruction" actually states:

The funds will be available to redraw at a later date subject to KBC Homeloans Terms and Conditions.

Well, are there any restrictions on the availabity of the redraw facility in the KBC Homeloans Terms and Conditions?

hi all,

I rang KBC there (for another matter) and asked for clarifications on this. Seemingly anyone who has drawn down their mortgage since 2013 is not available to use this facility. I queried the content of some of the letters I have been issued, and was given the opportunity to redraw all overpayments to date, but would not be allowed to redraw any more overpayments made.

I have asked for a complaint to be raised on this for processing - since I have clear letters stating draw was possible (without any caveats). We will see what the outcome of this is, but given KBC's track record of treating existing customers I would not be hopeful.

However, looks like the main benefit for me to remain with KBC is now gone, so time to start looking elsewhere.

gnf,
Is it just the monthly overpayments that you can't redraw? Presumably, you can still redraw the deposit amount(s) that you have lodged against your capital?

@tereyk to be honest I understand any overpayments made now are not available for redraw, whether they are once off or regular payments

I have asked for a formal complaint to be raised - so will see what comes from that, but for the moment I am assuming any further overpayments made are not available for redraw. We are likely to have a dispute on the older stuff, but will see what happens next

I drew down a mortgage with kbc 13 months ago and have overpaid a significant amount on that mortgage on the basis of the advice I received from the Bank which was that I could overpay and if I wanted could redraw the overpaid amount in the future. So it made absolute sense for me to overpay as much as I could.

I found out last week when I phoned the bank also to query something else that this was a mistake and that whilst I could redraw back down the overpaid sum I could no longer continue this facility and in fact I should not have been allowed in the 1st instance.

I was advised many times by phone that I could do this because I did question it with them when the question was previously raised in this forum. So they messed up here.

I will need to redraw my funds back down but am disappointed that this facility is no longer available as I very much valued it!

What, if anything, should be my next step (other than redraw my money which I need to do)?

As a follow-up on this one, I had a response to my formal complaint from KBC. The summary is:

1. Regular Overpayments made via Flexible Repayment Instruction are still available for re-draw as per the confirmation letter from KBC. I have this in writing so it is clear enough. I had been incorrectly advised this was not available for re-draw

2. Lump Sum overpayments made are NOT available for redraw, and this facility was removed for any customers taking out mortgages after September 2013. I don't have any written record on these ones, but have asked for them to review the phone records for July 2015 to confirm my understanding I was informed that the funds would be available for redraw.

Either way, from my point of view, the principle benefit of being with KBC is now gone, so its now a matter of assessing what to do next. I really valued the redraw option personally, but at least I found out before I made another lump sum overpayment

Hi GNF,

what does your first point mean? is it that if you overpay your monthly repayment you can redraw that back down? if so, could you overpay by any amount and if so does this not mean the facility is effectively still there?

@jim
I am only going on the response to my internal KBC complaint. My Flexible Repayment Instruction was processed in July 2015. Under the terms I signed up to, I have the ability to redraw these funds. I have written confirmation of this in the response letter(s) from KBC.
However, they have advised they are reviewing these terms currently. My 'historic' instruction agreement still stands, and therefore I can continue to redraw these funds as long as the instruction is not modified.

I would advise to contact KBC and ask about what the terms are for the Flexible Repayment Instructions currently, and you can base your decision on this.

I want to overpay my mortgage, drew down my mortgage in Dec 2015, got form that I can redraw money back today, if you have say 12k, do 4 months of 3k, if you can’t do lump repayments

Will that work? (Appears to be good deal)

@desmondo I answered the same question in the other thread

All, as an update on this issue since May 2016
I ended up going through a lengthy internal complaints/dispute process with KBC on this issue for a good 6 months in 2016. The agreed outcome in the end was I could redraw the regular over-payments and lump sum payments made in 2015, but was not permitted to redraw any further over-payments made from 1st January 2016. This agreement suited me, as I had made considerable over-payments in 2015, and gave me access to a reasonable emergency reserve fund. I should add I also made further over-payments in 2016 and 2017, but these are not available for redraw. This agreement was also formally included in a FSO mediation resolution agreement on another issue in 2017, so I am pretty confident there is no chance it will not be honoured.

I am not sure why I was given the concession by KBC. Initially the only option available to me was to redraw all of the overpaid funds immediately. My argument was that I had received a letter from them confirming I could overpay the mortgage and redraw the funds at a later point. I had then checked this with the mortgage team and they confirmed I had this facility available to me - in an email. I then made a clear decision to liquidate other investments and paid a considerable lump sum against the mortgage - based on the facts they had given me in writing. I had also said that if the issue had not been resolved satisfactorily I would have brought it to the FSO for resolution.

I recently moved to a 10 year fixed rate with KBC, and I was advised at the time that the redraw is not affected by this and I simply pay 2.95% on any increased mortgage balance post redraw.

So the only advice I have for anyone who feels they may be in the "grey territory" here is to confirm what written confirmation you have around the redraw facility, what validation you done to ensure you were eligible etc. I would be suspicious that you will have any success in disputing this unless you validated with KBC that you were eligible. If you wish to PM me on anything further I am happy to discuss.