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Bank of Ireland launches mortgages for negative equity customers

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BANK of Ireland has launched new mortgages for customers in negative equity that will allow them to move home.

However, for many the sting in the tail will be the loss of a tracker mortgage for those who want to trade up.

These mortgages are linked to the Central Bank rates, which are currently at record lows, are loss-making for banks but cheaper for customers.

According to the bank, the new mortgages are in line with Central Bank guidelines and will be offered in two forms.

Customers who are trading up will not be able to take their tracker mortgages with them, but those who are trading down will be able to keep the lower tracker rate.

The bank said that 50pc of its mortgages are in negative equity.

“The majority of our customers are not in financial difficulty but some of those who purchased homes, particularly in the last six or seven years, are currently in negative equity,” said Jonathan Byrne, head of mortgages, Republic of Ireland.

“Whilst this is only a problem for those who want or need to move, some customers may have experienced changes in their lifestyles such as getting married, having children or changing jobs, and now need to move home.”

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