Thousands of Bank of Ireland customers with a tracker mortgage will be paying a higher interest rate from tomorrow, including some sold a ‘lifetime’ tracker, despite a static base rate.
Which? believes that the bank is potentially treating approximately 13,500 customers unfairly by hiking rates using clauses buried in the small print of mortgages taken out before October 2004.
We are advising Bank of Ireland mortgage customers to complain if they were led to believe their rate would track the Bank of England base rate by the same amount for the term of their mortgage or if their mortgage had ‘life’ or ‘lifetime’ in its name.
Which? has created a free online tool to make it easy for consumers to complain directly to the Bank of Ireland, at www.which.co.uk/bankofireland
Which? executive director Richard Lloyd said:
“Burying such important changes in the small print is wholly unfair. Bank of Ireland is taking advantage of its customers by hiking rates at a time when the base rate is static.
“Customers should complain if they were led to believe they had bought a ‘lifetime’ mortgage and Bank of Ireland must deal with these complaints quickly and fairly.
“The Financial Conduct Authority must make sure all banks communicate important clauses to their mortgage customers, and the Government must ensure that the Consumer Rights Bill offers greater protection from unfair terms and conditions.”
Notes to Editors
1 The Bank of Ireland’sUKmortgage businesses intend to increase the interest rate payable on certain tracker mortgages to base rate plus 4.49% for buy-to-let mortgages and base rate plus 3.99% for residential mortgages. The rate rise will come into effect for buy to let mortgages on1 May 2013, and for residential mortgages the rate rise will be implemented in two phases, on1 May 2013and1 October 2013. We understand customers were informed of this rate rise at the end of February.
2 Reports from Which? members suggest that this represents an interest rate rise of up to 3.99% in some cases. We have received, and continue to receive, numerous complaints on the issue.
3 The Bank of England base rate is theUK’s official rate of interest and has been at a historic low of 0.5% since March 2009.
4 Which? believes that the forthcoming Consumer Rights Bill should include provisions to offer consumers greater protection from unfair terms and conditions.