My family and I moved to Bray six years ago. Just missing out on the tracker option, we took out our SVR (standard variable rate) mortgage with Permanent TSB in June 2009.
At the time, Permanent TSB charged around the same as the rest of the market. Then its started pushing up the rate while others reduced theirs. By August 2011, we were paying 6.15pc, while AIB and BoI were charging 3pc. By this time, mortgage lending was effectively frozen. The banks were all but closed for business. We were trapped and couldn't switch.
In May 2012, I spoke at the Permanent TSB AGM about its exorbitant variable rates (5.19pc while ECB was back at 1pc). Soon afterwards, the bank announced a token reduction in their rate, along with empty promises of more to come. The office of the CEO, Jeremy Masding, said at the time: "I would hope that as conditions improve in the funding market and in the wider economy in the years ahead, we will be in a position to reduce our variable rates further."
In April 2012, the ECB rate stood at 1pc. By November 2013, it was at 0.25pc. No rate reductions ensued for us. Today, the ECB stands at 0.05pc. We are now paying an interest rate of 4.5pc on our mortgage.
In October 2014, I contacted Permanent TSB and asked for a reduction in our interest rate. We were declined. A new customer to the bank with the same size borrowing, same loan term and LTV ratio (60pc) would be charged 3.8pc.
At this rate, over the remaining life of our mortgage, we will be paying the bank €36,000 more than the new customer. This is money that we would otherwise be spending in the local economy, helping to create employment and stimulate growth. We are not in arrears nor have we ever missed a repayment. We are not looking for a special deal, we are simply looking to be treated the same.
In an ideal world, all existing SVR customers with the main lenders would apply to another bank in order to avail of lower rate offers.
When our third child came along, it no longer made financial sense for me to continue working. As a result, we would no longer meet the lending criteria to allow us to switch to another lender; we are, in effect, prisoners of Permanent TSB.
Management at Permanent TSB made it very clear at its AGM last week that there were no plans to consider cutting the SVR until the bank was back in profitability. Having already experienced empty promises from the bank, I would not hold out any real hope for action by it in the foreseeable future. In a special supplement in last Thursday's Irish Independent, Richard Kelly, head of mortgages at Permanent TSB, says: "Mortgages must be all about the customers and what they need".
Last week, European Union state-aid regulators approved Permanent TSB's restructuring plan after the bank pledged to raise net interest margins and sell low-yielding assets over the next three years. I don't think that you need to be a banker or an economist to see the complete contradiction in terms here.
If I was a borrower in any other Eurozone country, I would be paying as much as €400 less per month, with an interest rate of approximately 2.3pc. The "our blended cost of funds is too high" stock answer from the banks is simply not good enough. Irish SVR customers are being completely ripped off. It is immoral and unacceptable.
It is time now to lobby our elected representatives, to make them aware of how important this issue is to their constituents. There is approximately 300,000 SVR customers across the main lenders who are in exactly the same situation as we are.
Borrowers, and their families and friends, are voters, and with a general election around the corner, politicians need to give serious consideration to this segment of the electorate.
TD Michael McGrath raised the issue in a private member's motion in the Dail last week and Junior Minister Simon Harris -representing the Minister for Finance Michael Noonan - responded.
Deputy Harris spoke of the progress made in respect of repossessions and arrears, but appeared to have no concrete action plans to help SVR borrowers. It seems that the minister is not willing to intervene and exercise his control, as the major shareholder in the State-owned institution.
Many others like me believed that the current Government was going to bring about real change. If this Government is to continue to get a mandate from the people to run the country, they will need to act on this issue promptly.
We will be organising a public meeting in the very near future to discuss this issue in detail and hope that Minister Noonan will accept our invitation to attend in order to communicate directly with us. People can get in touch with us through facebook.com/SVRmortgagecampaign. There are also ongoing discussions on askaboutmoney.com.
It is imperative that more borrowers make their voices heard. We have succeeded in raising the profile of this issue in the public eye and will keep the pressure on until such time as the minister takes action.
Thousands took to the streets about water charges, an average of €20 per household per month. If the average SVR mortgage borrower had an interest rate in line with the rest of Europe, they would be paying in the region of €250 less per month to the ir lender. Some 300,000 SVR borrowers are propping up our struggling State-funded banks which have already been bailed out by us as taxpayers.
I call upon Mr Noonan now to do the right thing for my family and all the borrowers like us.