EBS What does an EBS "Variable Base Rate" mortgage mean?

[gnf_ireland]

Thank you for your support gnf_ireland and apologies for questioning you.

There is absolutely no need to apologise for anything whatsoever. You are well within your rights to question and challenge. Mine is only one view, yours is different and as a wise man once told me "Your opinion is never wrong, because it is YOUR opinion"

for the legal aspect we will leave Padraic Kissane along with Central Bank to deal with To Be Or Not To Be Variable Base Tracker.

And I wish anyone impacted by this the very best of luck in their discussions on with Padraic and others on it.

I genuinely wish you all the very best of luck with this and hope you can reach a conclusion with EBS on it. I will keep an eye out on progress on this and other tracker scenarios....

 

[RAzvan R]

Pugyo-What are the dates on that loan offer & issue of cheque letter ?
A bit strange that loan offer rate after 3 years is different to cheque issue letter.

I meet with 6 people who got their Mortgages from Carlow EBS in the same time frame like uș between 2004 to 2008.
Every single contract is different and I’m not refering to the Value of the loan.
What I’m refering too is that the same interest rates were specified differently by each EBS Sales Representative from that time.
Real Examples;
Fix Rate mentioned in contracts as Nominal Rate, Base Rate, % Rate, EBS Rate.
SVR - I did not see any contract with this rate between this time frame.
Tracker Rate mentioned in contracts as Variable Base + % margins, loan type Variable with loan rate Variable Base no margins specified, Variable + % margins.
Tracker rate was mention only in the Tracker form as ECB + % for the specific time mentioned in the loan offer.
This is also proving that EBS did not have any standards description or standard operating procedure with regards to the available rates at that time.
We will find out the answer in June.

 

[B26354]

In the EBS Terms & Condition is mention that their rate is link to an index or indices.

Razvan-do you have an image of this? I can’t find it in in my mortgage conditions I received with my loan offer.

I did find the below detail (see image) in my conditions however. The interest rate basis on which my loan is calculated is not stated in my loan offer.Another condition broken.

 

[haveaniceday]

Hi there

i am submitting another letter to EBS to followup on the FOI I submitted last december - details are missing from what they gave me - i know this as some documentation was emailed to me by my broker, when i was getting the mortgage which I still have, but was not included in what they sent me -
questions are
- 1) does this mean they don't have this info anymore - ?
2) do i still have to wait another six weeks to get the response from them ?

 

[B26354]

Hi there

i am submitting another letter to EBS to followup on the FOI I submitted last december - details are missing from what they gave me - i know this as some documentation was emailed to me by my broker, when i was getting the mortgage which I still have, but was not included in what they sent me -
questions are
- 1) does this mean they don't have this info anymore - ?
2) do i still have to wait another six weeks to get the response from them ?

Under FOI they should have sent you everything they had on file as far as I know but it did take me multiple phone calls after my FOI request to get all my documents and there are still some that have never been sent.

In my most recent conversation with the helpline they said that they are now dealing with a huge volume of complaints about trackers and this issue being discussed and this involves sending customers &/or their representatives additional documentation. It could be that they are just overwhelmed with the demand but more likely that the drip feed of info to customers is to drag things out & hope political & central bank pressure eases. That’s my theory anyway!

 

[Nationaldude]

 

[B26354]

Hi haveaniceday, try this?

Thanks Nationaldude.
As you can see from your loan offer, the interest basis is specified. This is not included on the fixed term offers that roll onto the variable base rate. The terms & conditions of my loan & the fixed rate application form say the interest rate basis is specified in my loan offer but it’s not.

The 2nd part that you highlight is to do with the LTV & associated tracker margin i.e.+1.05. It was +1.25% for LTV loans of 95%+.

 

[Nationaldude]

Hi B26354, I'm far from an expert on these matters I just thought the fact that even though we were offered Variable ECB Base + 1.05%, the second part I highlighted states that the "Tracker we were being offered" might be of help to somebody arguing whether they are on a variable or tracker rate? As i said i'm far from an expert.

 

[RedOnion]

might be of help to somebody arguing whether they are on a variable or tracker rate?

I'd say your document does the opposite of helping the position that's being put forward by others. Your letter clearly distinguishes between a tracker rate and a variable rate, so it's clear to me that both existed at the same time.

Edit: just to be clear, I did not mean to suggest you were being unhelpful in case this is how others are reading my comment. just that the document might be seen to go against what some posters have suggested. It is always good to see full wording, rather than a single sentence which can be taken out of context.

 

[haveaniceday]

Funny you say that redonion - but my broker was sure that my loan had that clause in it ( if tracker not available you will get the variable rate )when I got in touch with him recently- but it did not - that was in feb 2008 - i asked him to request a tracker - I have a copy of the fax where he requested the tracker - the loan offer I got said base rate 5.25% - he has no explanation today for me why ? I was told in July 2008 that the tracker was no longer available when I drew down the loan - last week he told me he believed I didn't have to sign off a new loan offer in july 08 because that clause was in my mortgage - it was not.

 

[B26354]

Funny you say that redonion - but my broker was sure that my loan had that clause in it ( if tracker not available you will get the variable rate )when I got in touch with him recently- but it did not - that was in feb 2008 - i asked him to request a tracker - I have a copy of the fax where he requested the tracker - the loan offer I got said base rate 5.25% - he has no explanation today for me why ? I was told in July 2008 that the tracker was no longer available when I drew down the loan - last week he told me he believed I didn't have to sign off a new loan offer in july 08 because that clause was in my mortgage - it was not.

Haveaniceday-You should have still been offered the tracker(see image attached).your case is somewhat unique in that you started off with a fixed rate term to roll onto variable base rate that you were told was a tracker. You then asked to start off on a tracker and they didn’t change wording so rightly you assumed the variable base rate was still a tracker. It was during mid 2008 that they re-interpreted the variable base rate to as an SVR.

 

[tonymac]

As i am the person who made the original posting i wish to thank each and every one of you for for youre contributions. If i had known when i posted it i would get over 130 postings in reply i would have laughed but as ive now gone through them all it appears that EBS are very ambiguous in their wording on the contract/letter of offer. My partner has agreed as its her mortgage that i will ring Padraig Kissane on her behalf and explore this a bit more as there are arguments on both sides and at least hear what he has to say and get it sorted once and for all. He could very well say not a hope at which itll be end of story or who knows it could go further but i will let ye know how it goes once he has seen my partners documents and some of the information from this site.

 

[B26354]

As i am the person who made the original posting i wish to thank each and every one of you for for youre contributions. If i had known when i posted it i would get over 130 postings in reply i would have laughed but as ive now gone through them all it appears that EBS are very ambiguous in their wording on the contract/letter of offer. My partner has agreed as its her mortgage that i will ring Padraig Kissane on her behalf and explore this a bit more as there are arguments on both sides and at least hear what he has to say and get it sorted once and for all. He could very well say not a hope at which itll be end of story or who knows it could go further but i will let ye know how it goes once he has seen my partners documents and some of the information from this site.

I’d argue it was a purposefully ambiguous term that gave EBS a level of control over what they could offer people at the end of their fixed term and it also dissuaded people from investigating further. At least that’s what happened to me and others on here who have relayed similar stories that they too thought they were to move onto a tracker but were moved onto a traditional “variable rate” or SVR.

In 2007 after a brief conversation with my broker I expected to move onto a tracker rate after 3 years when I signed the loan. 3 years later in 2010 I was put on a “variable” rate/SVR so I rang EBS and they said my loan offer says that I can only be offered a variable rate as that is what is specified on my loan offer. I checked my loan offer, saw the word “variable” and just thought I had messed up for wrongly assuming it was a tracker in 2007. My broker wasn’t much help when I rang him so I basically blamed myself for being naive enough to make a bad financial decision.

It was only in 2015 after a conversation with my friend who suggested I go back and look at my loan offer thoroughly particularly the definition of the rate I was to roll onto as he said trackers were not always called trackers but also defined as variable rates. I said I was definitely only entitled to a SVR rate but checked it again, saw the variable base rate definition, investigated further and then started to see what had really happened to me and obviously a lot of other people.

 

[tonymac]

If i remember correctly and im open to advice or correction there is a consumer protection law that says if a service provider uses ambiguous terminology that any outcome should favour the customer. As you say B26354 it was only after that conversation with youre friend that you looked at youre offer again, for my partner it was only when i got involved in the fair mortgage rates campaign and found out that EBS stopped doing trackers in Oct 2008, 1 year and 5 months after she took out her mortgage i realised there was a potential issue here. I have also noticed that some people got trackers offered to them after May 2007 either by request or through a brokerage. Obviously her broker firm would be getting a call from her to explain the advice she got but it appears that the firm unsurprisingly isnt trading anymore, perfect mortgages, and she like most people wouldnt have expert financial knowledge. Also as one poster said previously the variable and tracker rates were exactly the same around that time and they werent obliged to tell people the range of products available to them which appears like theyre hiding something. If they were doing so why offer trackers in the first place like one of the worst offenders in the banking crash, Michael Fingleton did, my information is his irish nationwide never offered a single tracker mortgage.

 

[gnf_ireland]

Nationaldude, they are people on this thread with 2, 3 & 4 kids and couples with no kids who can lose their home after 10 or 14 years just because of this wording differences not mention in their contracts.
Do you think is funny?
Nationaldude haș nothing better to do with his time and usualy is going on threads and make poor coments.

@RAzvan R I just had a look over Nationaldude's posting history. He has made 16 posts in the last 18 or so months. This is hardly someone with nothing better to do with their time. Not sure the same could be said about myself, but that's a different topic

I think you might be a bit unfair towards him. I accept he may not have supported some of the discussions on here, but he is hardly laughing at people. If you go back through the posting history, it shows he was in negative equity himself at one stage also, so I am sure there is a level of empathy there.

No one is against anyone getting a tracker back where it is deserved, and redress & compensation provided where people have been wronged. No one under estimates the seriousness of this issue for a large number of people - the money involved here is quite substantial in most cases.
However, any customer who is in arrears and engaging with the bank, and paying some level of mortgage repayments will not have their house repossessed in the current political environment. You just have to read the reports from the courts to validate this. The only repossessions granted are those in long term arrears who have paid little or nothing to the bank in years, and have barely engaged with them. This is not to diminish the impact on people, but sensationalising it also defeats the purpose.

Rightly or wrongly, all Nationaldude done was show a contract with a tracker clearly called out on it. Some here have said that EBS IT systems did not support the term tracker - and this casts doubt on this theory.

 

[gnf_ireland]

If i remember correctly and im open to advice or correction there is a consumer protection law that says if a service provider uses ambiguous terminology that any outcome should favour the customer.

Yes there is, but the courts have to agree the term is ambiguous unless the other party agrees. There is a difference between ambiguous and not understood

I think there is a line in the constitution something like:
ENGLISH VERSION => has reached his thirty-fifth year of age
IRISH VERSION => has completed his thirty-five years
You reach your 35th year the day of your 34th birthday, this is ambiguous.

I don't know which way a court is likely to go in the discussions above

 

[B26354]

Valid point GNF.
I think I said the word tracker is not used in EBS loan offers when I should have been more specific by saying it is not used when defining the rate or the interest rate basis on loan offers where customer started off on tracker.

 

[gnf_ireland]

Also as one poster said previously the variable and tracker rates were exactly the same around that time and they werent obliged to tell people the range of products available to them which appears like theyre hiding something.

I had a quick look at the ECB rates back at the time in question
2005/12 +25bps
2006/03 +25bps
2006/06 +25bps
2006/08 +25bps
2006/10 +25bps
2006/12 +25bps
2007/03 +25bps
2007/06 +25bps
2008/07 +25bps
2008/10 -50bps
So at the time the ECB rate was steadily rising and did not start to drop until October 2008 when trackers were taken off the market by enlarge.

I know looking back with hindsight, trackers were great, but no one could have known this in 2007-08. Trackers at the time were steadily increasing in price. This is why people fixed at the time - because trackers were on an upward trajectory.

We should not lose sight of the fact that trackers only became valuable with hindsight!

 

[gnf_ireland]

I think I said the word tracker is not used in EBS loan offers when I should have been more specific by saying it is not used when defining the rate or the interest rate basis on loan offers where customer started off on tracker.

As I said previously, its very likely this will need to go legal to get resolved. Being crystal clear is imperative in any legal discussion. Every hole weakens the argument

 

[B26354]

As I said previously, its very likely this will need to go legal to get resolved. Being crystal clear is imperative in any legal discussion. Every hole weakens the argument

Well EBS haven’t been crystal clear with customers and they’ve admitted it. I’m hopeful it will be sorted out by the central bank review.