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Another bank to put customers back on trackers

  

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 (stock photo)

(stock photo)

(stock photo)

A second lender has conceded it will reinstate a large number of mortgage holders to tracker rates.

It comes after it lost a case before the Financial Services Ombudsman, and has now said it would apply the findings to others in the same circumstances.

The mortgages were originally issued by Bank of Scotland (Ireland), which is to restore the trackers and pay compensation despite selling on the loans, the Irish Independent understands.

Earlier this month, AIB indicated it would restore another 6,000 customers to a tracker rate and compensate them after a preliminary ruling against it by the ombudsman.

Bank of Scotland introduced tracker mortgages to Ireland in 2001. The rate on these can move only within a set margin of the European Central Bank rate, and are often set at 1pc over the ECB rate, making them good value.

Hundreds

Bank of Scotland originated the loans affected.

The exact numbers involved are not known but there are understood to be hundreds.

The bank's portfolio of 20,000 Irish mortgages was sold to British rival Barclays in 2018, and are now serviced by Shannon-based Pepper.

Up to now, Bank of Scotland has admitted close to 500 customers have been hit by an industry-wide debacle. This has meant they were either denied their right to a cheap home loan linked to the main ECB rate, or put on an incorrect rate.

In the case published by ombudsman Ger Deering he found the bank, which he did not name, had denied a couple the return to a tracker rate of 1pc over the ECB rate when they fixed for a while.

He directed they get back their tracker rate, and that they be refunded overpaid interest going back to 2010. They are also to get compensation of €2,500.

The originating bank has to pay up even though the loan has since been sold.

Bank of Scotland said the decision would result in additional customers having their mortgage reviewed in line with Tracker Mortgage Examination principles.

Irish Independent