Tracker Mortgage Decision Reference 2025-0199

• Case Outcome: Rejected
• Year: 2025
• Reference: 2025-0199
• Date: 18 December 2025
• Subject Matter: Tracker Mortgage
• Finantial Sector: Banking
• Conducts Complained Of: Failure to offer a tracker rate throughout the life of the mortgage

Decision Ref:

2025-0199

Sector:

Banking

Product / Service:

Tracker Mortgage

Conduct(s) complained of:

Failure to offer a tracker rate throughout the life of

the mortgage

Outcome:

Rejected

LEGALLY BINDING DECISION

OF THE FINANCIAL SERVICES AND PENSIONS OMBUDSMAN

Background

This complaint relates to a mortgage loan account held by the Complainants with the

Provider. The mortgage loan that is the subject of this complaint was secured on the

Complainants’ property which was a commercial and residential premises.

The Letter of Approval dated 02 August 2007 provided for a loan amount of €523,000.00

(five hundred and twenty-three thousand euro) and the term of the loan was 25 years.

The mortgage loan account was drawn down on 11 October 2007.

The Complainants’ Case

The Complainants submit that they drew down a mortgage loan pursuant to a Letter of

Approval dated 02 August 2007 which provided for an interest rate of 5.50%. The

Complainants refer to a Term Sheet dated 05 July 2007 which quotes an interest rate of

“5.50% (1.50% above ECB)” and maintain that their loan was approved based on a tracker

interest rate of ECB + 1.5%.

- 2 -

/Cont’d…

The Complainants submit that there is nothing in the loan offer that adds anything further

to the agreed rate as set out in the Term Sheet dated 05 July 2007.

The Complainants assert that a tracker interest rate of ECB + 1.5% should have applied at

drawdown and state that they have been denied the correct interest rate in respect of

their mortgage loan.

The Complainants submit that the Provider has attempted to “alter or adjust its own

definitions to add confusion.” In this regard, the Complainants refer to the Council

Directive 92/13/EEC on Unfair Terms in Consumer Contracts and maintain that the

Provider must satisfy the requirement of “plain and intelligible drafting”. The

Complainants further submit that a margin increase by 200% “is clearly stated nowhere

and the condition relied on by [the Provider]” is an unfair term.

The Complainants submit that they “trusted the lender to do its job and it did, only for it to

retrospectively go back on the agreement, but for reasons that have nothing to do with

[the Complainants’] loan.”

The Complainants are seeking:

(a) A tracker rate of ECB + 1.50% to be applied to the mortgage loan account; and

(b) A refund of overpaid interest from expiry of the interest only period from

November 2012 to date.

The Provider’s Case

The Provider submits that the Complainants were existing customers of the Provider when

they approached it in relation to their application for loan finance in 2007. The Provider

submits that the proposed mortgaged property for the new loan application was, at the

time of the application, already held by the Provider as security for a mortgage loan

account ending 5783 which had been drawn down by the Complainants in 2003.

The Provider submits that the Complainants planned to redevelop the property to include

construction of a commercial and residential premises. The Provider states that the

Provider’s commercial lending division processed the loan application. The Provider refers

to an Investment Mortgage Proposal form which refers to the pricing of the loan, with a

margin of 1.5% over the ECB rate and submits that “this is a reference to an internal pricing

discussion and not to the subsequent loan offer which the Bank decided to make to the

Complainants”.