Up to 1,500 homeowners get refunds after lender admits to rate error
MORTGAGE lender ICS Building Society has had to refund 1,500 customers after overcharging them for their home loans, the Irish Independent has learnt.
One homeowner got a cheque for more than €1,000 out of the blue after the lender said it had applied the wrong interest rate when the mortgage was initially taken out.
ICS, which is a subsidiary of Bank of Ireland, was supposed to apply a discount of 1pc to the mortgage when it was drawn down, but ended up applying a smaller discount. It is understood 1,500 customers are getting refunds, with an average €300 being paid out.
The bank said: "We identified a number of customers where the interest rate margin quoted on letters of offer was different from the interest rate margin applied to the mortgage account on drawdown, as a result of rate changes in the intervening period. The average refund is €300."
This is just the latest bank overcharging controversy.
Last week a company part-owned by AIB admitted that people who used debit and credit cards were double-charged for goods and services.
AIB said the affected shoppers would not end up having to pay bank charges or overdraft fees because of the error.
People who bought goods and services on plastic cards on Monday, January 13, ended up being charged twice when they used terminals supplied to retailers by a firm part-owned by AIB.
Anybody who had a refund processed on the same day ended up getting double the amount of money they were due. About 48,000 card users were impacted.
And a number of banks have been forced to refund mortgage holders after taking away the option of them returning to a valuable tracker rate when they opted for a fixed rate.
One broker said he had secured a total of €300,000 in compensation from the bank over its failure to put people back on trackers when they finished on fixed rates.
Padraic Kissane, of Kissane Financial Services in Dublin, said he had succeeded in getting 13 of his clients put back on trackers with Ulster Bank.
And AIB has admitted it has also had to restore a number of its home-loan customers to tracker mortgages.
In 2011, Bank of Ireland was forced to put more than 2,000 customers back on trackers and also compensate them. And another broker, Bob Quinn of moneyadviser.ie, said he had secured a refund of €7,000 for one customer and €25,000 for another mortgage holder from Ulster Bank. In both cases the homeowners came to the end of three-year fixed-rate deals in 2009 and it was not made clear to them that they could go back to their trackers.