Tracker Mortgage Decision Reference 2022-0134

• Case Outcome: Rejected
• Subject Matter: Tracker Mortgage
• Reference: 2022-0134
• Date: 19 April 2022
• Finantial Sector: Banking
• Conducts Complained Of: Failure to offer a tracker rate at point of sale,Failure to offer a tracker rate throughout the life of the mortgage

Decision Ref:

2022-0134

Sector:

Banking

Product / Service:

Tracker Mortgage

Conduct(s) complained of:

Failure to offer a tracker rate at point of sale

Failure to offer a tracker rate throughout the life of

the mortgage

Outcome:

Rejected

LEGALLY BINDING DECISION

OF THE FINANCIAL SERVICES AND PENSIONS OMBUDSMAN

This complaint relates to two mortgage loan accounts held by the Complainant with the

Provider, as follows:

1. Mortgage loan account ending 8834 was secured on the Complainant’s principal

private residence. The loan amount was €33,000 and the term of the loan was 20

years. The Amended Letter of Loan Offer dated 25 November 2002 was accepted

by the Complainant on 18 December 2002. The interest rate applicable to the

mortgage loan was a 1-year variable discount rate of 3.85% with the mortgage loan

to convert to the variable base rate thereafter. The mortgage loan account was

fully redeemed on 8 June 2006.

2. Mortgage loan account ending 0044 was secured on the Complainant’s principal

private residence. The loan amount was €80,000 and the term of the loan was 20

years. The Letter of Loan Offer dated 15 September 2006 was accepted by the

Complainant on 25 October 2006. The interest rate applicable to the mortgage loan

was a variable base rate of 4.25%. The mortgage loan account was fully redeemed

on 4 May 2010.

- 2 -

/Cont’d…

The Complainant’s Case

The Complainant outlines that he held two mortgage loan accounts with the Provider,

both of which are now redeemed.

The Complainant submits that mortgage loan account ending 8834 was for a loan amount

of €33,000.00 and was drawn down on 18 December 2002. The Complainant submits that

when he completed the application form for mortgage loan account ending 8834, he

selected the variable interest rate. The Complainant maintains that this application was

“completed correctly”. The Complainant asserts that when the Provider introduced the

tracker mortgage as part of its product offering in 2004, he was not advised of this interest

rate option. The Complainant states that he sold the secured property the subject of

mortgage loan account ending 8834 and redeemed the loan on 8 June 2006. The

Complainant states that he subsequently decided to purchase another property which

required a mortgage for €80,000.00.

The Complainant states that mortgage loan account ending 0044 was for a loan amount of

€80,000.00 and was drawn down on 21 December 2006. The Complainant asserts that he

received no advice from the Provider in relation to the availability of the tracker mortgage

product.

The Complainant states that the mortgage loan application was not completed by him,

however he did sign the application form and the “variable mortgage box was selected” in

his absence. The Complainant submits that “no staff member or the staff member who

completed the form took the time to bring me up to speed on the different options”. The

Complainant maintains that the decision to choose a variable rate “was made for [him]”

and that he received no advice.

The Complainant states that this is “completely inappropriate” as he was “capable of

completing” the form. The Complainant submits that “[a]t no point was a tracker

mortgage mentioned” and that this “amounted to mis-selling of products”. The

Complainant refutes the Provider’s submission that, in signing the application, the

Complainant agreed to the mortgage loan offer “as it would not have made any sense

whatsoever from a personal or financial point of view to select a variable rate above a

tracker rate.”

The Complainant states that he applied a 3-year fixed interest rate to mortgage loan

account ending 0044 from 24 April 2007, ending on 30 April 2010.The Complainant states

that mortgage loan account ending 0044 was redeemed on 4 May 2010.