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Buy-to-lets may lose tracker deal

LUCRATIVE tracker mortgages could be withdrawn from buy-to-let investors who don't meet regular repayments.

Banks have warned customers that they must strictly meet their instalments or face losing the rate, which is tied to the European Central Bank rate.

This is at an historic low of 0.75pc.

And Bank of Ireland said that any investor who has come to the end of their interest-only deal would lose their tracker rate.

The move will come as a major shock to investors who took out mortgages with the bank during the boom and received interest-only deals.

The interest was typically given on a tracker rate.

The bank said that it will also strip the tracker rate from anyone wanting to negotiate a deal because they can't afford current repayments.

Ordinary residential mortgages are protected and cannot have their trackers taken off them, under Central Bank rules.

The Central Bank recently confirmed that arrears on buy-to-let mortgages are running at twice the level seen on residential mortgages.

Bank of Ireland has €7bn worth of buy-to-let mortgages, with chief executive Richie Boucher warning recently that €3bn of these are "problematic".

It is believed that other banks are now likely to follow the lead of Bank of Ireland and ICS, whose change of policy came into effect on Monday.