Struggling with buy-to-let BOI mortgage

Folks, Have a tracker Buy-to-let mortgage with BOI for about six years. Paid capital plus interest for year 1. Then interest only on ECB plus 1% for next 5 years. No problems at all. All payments on schedule. Now they are blankly refusing to give me another five years on interest only. Wont even consider that.
Am planning write to tell them ( very politely of course !) to go to hell that I will continue to pay interest only in current straightened circumstances, regardless of what they think may be appropriate. I will send those interest cheques monthly.
Suppose they can only bring me to court and try to force a sale of the property ? This is very good property, but is in negative equity although it is rented long term.

Anybody got similar experiences ? Love to hear about them and learn what I can from you. Thanks, Concerned in Westport.

Tom,
Count to ten first....
What you plan to do is an option undoubtedly, and they may eventually run with it ... however, you will also be breaking the terms of your tracker offering, and they will (quite legitimately), move you on to standard variable rate – if I were you I’d check out what this would likely cost me, and then see if I would still send them that letter...
If that’s still your decision, well fair enough, all I’m saying is research it first...

Good advice , Thanks.

If your interest only repayment is finished then you have to revert to what is in your mortgage terms and conditions which presumable is a variable rate now. If you do not make the repayments you will go into arrears and the bank will seek to repossess the house and recoup the negative equity, arrears and costs from whatever other assets you have.

If you cannot afford to make capital payments you need to discuss this with the bank, do not write any letters stating that you will not pay. They hold all the cards not you. Have you discussed other options with the bank such as extending the term to make the repayments more manageable?

Tom..my advice to you would be to sit down and chat with a mortgage representative or even a bank manager from BOI. In this climate, it benefits no one for you to lose your property. If the bank were to repossess..the property would more than likely sit idle for months ( the bank doesn't do rental) before it is sold at a loss to them..The positive here is that you are not in arrears and that they would rather you hold the property when in negative equity. What they are looking at is further down the line, your ability to pay after being on interest only for 10 years. Your capital repayments will be much higher as you have a shorter time span to repay the full amount of the loan. A possible solution here is to agree a slightly higher repayment over ur interest only now to chip away at the capital portion..An amount that you can reasonably afford. Rather than send a letter..arrange a meeting with bank manager..face to face..take it from there

Thanks DayTrader and Bronte, Good comments from both of you. Very helpful in trying to develop a strategy.
The mortgage is a long term tracker, so does not revert to variable rate automatically. However, if I break the terms , then they have that option as far as I can understand in the paperwork. So is same thing , I guess.
Bank has offered, by e-mail to the branch, to extend the mortgage for a further five years on Tracker as now , ECB plus 1%. Cannot afford that amount. Is similar amount to gross rental income. However , this does not take account of income tax, property tax , maintenance and void periods without tenants and all other running costs. Plan at present, is to take strong line to begin, of requesting interest only for next five years and saying that then I will and do expect to be in a better position then to start also re-paying some capital. Probably true in fact. Will see what happens.

Probably, they will threaten adding interest penalty clauses, or switching to higher variable rate and possibly to court. However, court will throw them out if I am already paying the interest charges, even at tracker rate, I think. They will know that also.

I will now take your suggestion and make appointment and talk first to the local manager, who I do know reasonably well. Not that this will count so much in present climate. Keep you advised. Any further thoughts/comments ? Many Thanks, JJT.

JJT said:

However, court will throw them out if I am already paying the interest charges, even at tracker rate, I think.
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What makes you think they will not foreclose on the property?

Have you done the figures on the return on the property to see if it makes sense to keep it rather than selling it? Maybe you should do the money makeover section on this website to see if you can free up some money to repay some capital.