10,000 could have tracker mortgages restored
More than 10,000 people across a string of banks could be in line for windfalls and be restored to cheap trackers.
Experts said the move by Permanent TSB to stop fighting attempts to restore customers to ultra-cheap trackers all the way to the Supreme Court puts pressure on other banks.
Permanent TSB is now set to restore as many as 2,000 mortgage holders to trackers, and compensate them.
The windfalls are likely to be between €10,000 and €15,000 per customer.
Other banks are now likely to have to make similar concessions to people who were not warned properly that they would lose their trackers when they opted to fix their mortgages, financial experts said.
It is estimated that around 10,000 people lost trackers across all the banks after opting for fixed rates in 2008 and 2009.
Permanent TSB has advised the Supreme Court that it is withdrawing appeals to that court that were scheduled for hearing later this month.
The issue relates to the position of two mortgage-holder couples who broke the term of their fixed mortgage rates early and then wanted to move to tracker rates.
They had been told they could go on to a cheap tracker after the end of the fixed-rate period.
They sought to hold the bank to its promise to allow them revert to a tracker.
But the bank fought this. It lost a case to the Ombudsman for Financial Services.
Another 80 cases were pending with the ombudsman on the same issue.
This ombudsman decision was appealed to the High Court, which upheld it. The bank then appealed to the Supreme Court.
But the bank has now dropped the Supreme Court action.
It is understood the decision of the Central Bank to take enforcement action against PTSB prompted the bank to concede defeat on the issue.
Up to 2,000 other Permanent TSB customers are understood to be in the same position, having been denied trackers.
Consumer advocate Brendan Burgess has calculated that people forced to pay at a variable mortgage rate, instead of a tracker, are overpaying by around €7,000 a year.
Dublin-based financial adviser Padraic Kissane, who has taken 300 cases on behalf of consumers to get trackers restored, said other banks will now be under pressure to take similar action to Permanent.
He said at least 10,000 people are affected across all banks.