Key Post What should PTSB customers do about the 6.05% SVR?

I listened to Brendan Burgess on Primetime tonight.

PTSb rates are almost 6%! Others are almost 3% lower.Therefore those of us who are stuck,and I mean stuck with PTSB,are forced to pay these very high rates.

As Brendan said,there are sub prime lenders who demand less.

PTSB were more or less first to say they would be passing on the latest interest rate cut to variable and tracker mortgage holders,as if they were doing us a favour,In other words,they HAVE to pass it on to tracker holders,so don't know why they would bother mentioning this.Plus most others are much lower.
Even with this rate cut,it is still extremely high.

However, as I understand it,they have so many trackers on their books that perhaps if they were to reduce their rates in line with other lenders,they may well go under?

Indeed, using http://www.drcalculator.com/mortgage/ie/

The payments for a 300K mortgage on AIB SVR over 25 years at the moment are 1422 per month

Same mortgage with PTSB, after their gracious passing on of the ECB rate decrease are 1914 per month.

Almost 500 per month of a difference!!!

Difference in interest payments over the term of ....just over 1470000, yes 147K??


Amazing differential from two enteties which couldnt exist without our (tax payers intervention).

Brendan,

Can mortgage holders move lender?
I have 3 PTSB mortgages, 2 on fixed, 1 supposed to be a tracker that comes off fixed next march on an investment property. What rate should I expect to go onto relative to rates now?
6.75% is a margin way in excess of the ECB rate. is there no way of stopping their madness? They were the cheapest when I took out the mortgage.

Listening to newstalk today and I think it was Emmet Oliver who was quoting the massive differentials in the rates between lenders.

However he quoted the extortionate rated of PTSB as 5.4% rather than the 6.15 (which will become 5.9% after passing on the rate decrease from ECB).

I'm amazed at how the ridiculously punitive rates from PTSB are not getting more air time. When they unilateraly increased their rates there was an outrage and waving of fists, but this lasted a couple of days.

I think the media need to again reawaken to the massive disparity in costs. Even while calling the rate at 5.4% the pundits concensed this was excessive. The true rates are even more mid boggling...

Prime time Thursday night was a good platform to highlight this and was done well.
I'd like to see the media follow up with the disparity question rather than the red herring 'did they or didnt they' pantomime of passing on ECB rates.

Bottom line..It doesnt matter if your lender passed on the ECB rate decrease. If that same lender has passed on unilateral increases in the last 2 years you are worse off...

Media need to address / focus on standardisation of rates.

Hi Watcher

Eamonn Gilmore was again calling for Bank of Ireland to reduce their rates on RTE radio yesterday. It's mind boggling stuff in the context of the PTSB.

I don't know where the 5.4% rate is coming from. It might a particular loan to value ratio, but it's not their standard variable rate.

Brendan

After reading this thread all I can say is, phew!!!
Our mortgage was with Irish Nationwide with a fixed rate of 3.24% due to end next February. As Irish Nationwide went under we were informed our mortgage would be passed on to PTSB.Within 2 weeks of receiving that letter we got another telling us it had moved from PTSB to Anglo Irish.
So now Anglo will honour the fixed rate till it turns to variable the start of March at a rate of 4.15%.
If we had to stay with PTSB at their rate of 5.95% I dread to think what would have happened.

Some questions please about extortionate PTSB Rates!!!

Moderator note
This thread is primarily about what PTSB borrowers can do about the rate they are being charged. There are two other threads:
What is the SVR for existing customers
Should the government tell banks what mortgage rate to charge

My wife and I bought a house in 2004 with a 30 Year 92% Mortgage with Permanent TSB.

November 2004 - 1 year fixed at 2.75%
November 2005 - 2 Year fixed at 3.39%
November 2007 - 4 year fixed at 5.5% - We were offered a tracker but unfortunately didn't take it.
November 2011 - PTSB have given us only 3 options, previously we were given between 5 and 7...

LTV Variable Rate - 6.05%
2 Year fixed Rate - 7.25%
5 year fixed Rate - 8.75%


These are outragious figures and it is disgusting what PTSB are doing to its customers, they basically have us over a barrel! The 2 year fixed rate would cost us €250 extra per month, while the 5 year would be €450!!!

At this point we have no option but to take the variable rate. I assume we have no come back relating to the tracker rate that we didn't take in 2007? Obviously we would have jumped on it had we realised what the future would hold. Should we have been offered a tracker this time?

We think our next option is to find out if we can switch to AIB if possible. Not even sure if that is possible right now! Would we be better off applying as a new customer and getting a lower rate?

Same boat as you only as yet I do not know what rate my tracker on a buy to let will revert to after my fixed rate ends.
Surely someone knows what the rate is?
Being on to the local TD about this as PTSB are using stealth to extort money out of mortgage. I like most people in a competitive environment chose PTSB for a mortgage. Now with limited competition and AIB not taking switchers PTSB are charging nearly double for a similar mortgage.

https://www.permanenttsb.ie/whatweoffer/mortgages/interestrates/
according to these stealers the rate for a newbie is 1% below what they are charging existing borrowers such as you LivEwirE

The PTSB rates are outrageous and the government needs to get directly involved in reducing these instead of just sitting back - PTSB is state owned. It isn't right that they are allowed to charge people several percent more than other state owned banks.

I think the biggest issue for those who are with the PTSB is that they cant switch to another lender.(or only in very limited circumstances )
In any other time,when you had a mortgage and felt the rates were too high,you had the option to move..in other words competition for the lender.
However now ,the situation is that people cannot move and are therefore stuck with PTSB,and they in turn can charge what they like.

In other circumstances I would say fair enough,they can charge what they want,and people can choose to stay with them or not,but not now,the situation has changed and people are being forced to stay with them.
This is why I think the Government should intervene,if nothing else but to allow people to move banks,not reduce their debts but be free to move them to a bank who charges a lot less.

Imagine a case where you have you home land line with company A,and have signed a contract with them,with the knowledge that you can move if their rates go too high, and then they charge hundreds more per month,but no other provider will take you on,you need the phone,you have no choice but to stay with company A.

There is no incentive for them to charge less,as they know you cannot move,even though you believed you would have that option..

I honestly think the Regulater needs to look at this,and perhaps it could be found to be unfair,as at the time of taking out the contract people believed they could move..
Where will it stop,what if PTSB decide to charge 20%.
I dont think anyone in their right mind would sign up to any contract where they can NEVER get out of it.
Either way, I cant think of any other company that you MUST stay with,no matter what they charge..can any one else think of one?

KBC will accept switchers if the loan to value ratio is less than 80%. SVR will be 4.25% from 1 December .

Bank of Ireland will accept their own general banking customers subject to an 80% LTV.

Bank of Ireland will accept non BoI customers subject to a maximum 50% LTV.

Why would AIB accept a switcher at 3% SVR? In fact, why would they lend at all at this rate? They have to pay more than this to attract some deposits.

The main thing which PTSB SVR customers can do is to start a campaign to get Michael Noonan to reduce the rate.

Brendan

I am a PTSB SVR customer and I have written to all my local TD's, Minister Noonan, Matthew Elderfield (the Regulator), The Financial Services Ombudsman and the Government appointed directors of PTSB. If enough PTSB SVR customers raise this issue something will eventually be done to force PTSB to lower their SVR to a more reasonable level.

I think the media are slowly picking up on this issue, it was mentioned on the RTE Frontline programme last night. It is up to any of us who have an interest in this to keep the pressure on PTSB any way we can.

I did write to PTSB and they confirmed that they were unwilling to change the terms and conditions of my SVR mortgage i.e. consider reducing the SVR to a more reasonable level.

I wonder if you could advise what format you think a campaign should take in order to have the best possible chance of success? I have two mortgages one with PTSB on variable rate & the other with NIB on a tracker ECB +.5% for the same amounts both residential mortgages. I missed out on the PTSB tracker by one week due to a valuation report not being submitted in the correct format & then missing the deadline although brokers were still able to secure the PTSB trackers for a time the bank were no longer offering them to direct customers. My PTSB monthly repayments are now almost 50% higher than repayments on the NIB loan.

A person with a mortgage of €200,000 is paying approximately €6,000 per year more than someone with AIB. This is per year, every year. It's huge. You do need to do something about it. Yet the government go on about how AIB not passing on 1/4 % will only make the arrears situation worse for AIB customers.

Here are my suggestions


1) Get a few people to stand outside the Dept of Finance with three placards saying "state owned AIB 3% " "Privatately owned Bank of Ireland 4% " "state owned PTSB 6% " (I am sure that someone can come up with something more imaginative)

2) Demand a meeting with the owner of PTSB - Michael Noonan to explain it to you.

3) Protest outside the PTSB Head Office and lobby their directors especially the public interest directors.

4) Tell your story to the papers and the media.

5) Whenever the TV or radio discuss the red herring of Bank of Ireland not passing on a rate cut of 0.25%, call in or text about the PTSB rate.

6) Contact your TDs and write to the government ministers directly

I wrote to my local TDs today. Derek keating replied and is going to call me this week. I will update after the call

I too cannot understand how there is not more public outrage aimed at ptsb.
For myself, it is getting to the stage where it is becoming a real struggle.
Surely, there must be something that all their disgruntled customers can do?

Are there any figures on what percentage of the overall market (in numbers (of borrowers) and/or money terms) PTSB SVR mortgage holders represent? Maybe it's not that big after all in which case the issue may not be as significant as first assumed and it may be no surprised that there is not more outrage?

Hi Clubman

Good point.

In total, there are around 700,000 customers with home loans worth €115 billion ( Central Bank arrears stats)

PTSB has a home loan book of €19 billion, so they have around 115,000 customers. (Central Bank PCAR )

60% are on trackers. (a figure widely used, not sure of its source)
I would guess that 20% are on fixed rates
which leaves around 20% on SVR

which gives around 20,000 home owners on SVRs now

with a total of 40,000 exposed to them over time.

If approx 20,000 PTSB SVR customers are paying an interest rates which is approx 3% higher that the AIB SVR and the average loan is €200k per customer then this equates to an extra interest charge of €6k per annum per customer or €120 million in additional interest in total per annum. If the number of customers on SVR's increases to 40,000 when their fixed rates expire the extra interest charged by PTSB will increase to €240 million (approx €1/4 billion) per annum. Lots of assumptions here - but this is a big deal for PTSB and its SVR customers.