Tracker Mortgage Decision Reference 2023-0011

• Case Outcome: Rejected
• Subject Matter: Tracker Mortgage
• Reference: 2023-0011
• Date: 23 January 2023
• 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:

2023-0011

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

Background

This complaint relates to three mortgage loan accounts held by the Complainants with the

Provider. The mortgage loans that are the subject of this complaint were secured on the

Complainants’ private dwelling house.

Mortgage loan account ending 6102

The loan amount for mortgage loan account ending 6102 was €140,000.00 and the term of

the loan was for 15 years. The particulars of the Mortgage Loan Offer Letter dated 18

March 2005 provided for a 12-month fixed interest rate of 2.75%, with a variable rate of

3.6% to apply thereafter.

Mortgage loan account ending 7768

The loan amount for mortgage loan account ending 7768 was €170,000.00 and the term of

the loan was for 25 years. The particulars of the Mortgage Loan Offer Letter dated 3

November 2006 provided for a variable interest rate of 3.5% to apply to the mortgage.

Mortgage loan account ending 7573

The loan amount for mortgage loan account ending 7573 was €442,000.00 and the term of

the loan was for 25 years. The particulars of the Mortgage Loan Offer Letter dated 26

March 2007 provided for a variable interest rate of 4.5% to apply to the mortgage.

- 2 -

/Cont’d…

The Complainants’ Case

The Complainants outline that they hold three mortgage loan accounts with the Provider.

The First Complainant is an employee of the Provider, and the Complainants submit that

the mortgage loan accounts are “what are known as staff mortgages”. The Complainants

detail that the mortgage loan accounts were “arranged directly over the phone with staff”

of the Provider.

In May 2005, the Complainants note that they signed the letter of offer for mortgage loan

account ending 6102, which provided for a fixed interest rate of 2.75% for the first 12

months, and a variable interest rate of 3.5% thereafter. The Complainants outline that the

rate changed to a staff tracker rate of ECB + 0.85% on 16 January 2006 and then on 12

December 2006 the rate changed to “a non-standard variable rate of 4.5%”

On 12 December 2006, the Complainants note that they signed the letter of offer for

mortgage loan account 7768, with a variable interest rate of 3.5% to apply for the first 36

months. The Complainants outline that mortgage loan account ending 7768 was drawn

down on 25 November 2007 on a staff non-standard variable rate of 4.5%. The

Complainants maintain that if a tracker interest rate had been offered, they would have

accepted it.

In May 2007, the Complainants note that they signed the letter of offer for mortgage loan

account ending 7573, for a staff non-standard variable rate of 4.5%. The Complainants

state that mortgage loan account ending 7573 was drawn down on a staff non-standard

variable rate of 4.5% and state that “a tracker rate (if advice ha[d] been given) would have

been the better option.”

The Complainants assert that they were not “at any time offered a tracker mortgage

despite the fact that they were being offered freely at the time.” The Complainants submit

that after speaking to a number of the First Complainant’s colleagues, they learned that “a

tracker rate should have been offered to [them] or at the very least discussed”.

The Complainants state that “[a]t no point during the process of obtaining the mortgage

was [it] discussed and or explained to [them] that a tracker mortgage was available and

the implications and advantages of same compared to other mortgages.”

The Complainants contend that they have made several attempts to ascertain why a

tracker mortgage was not offered to them however they did not receive a satisfactory

response from the Provider. The Complainants submit that they were “fobbed off” each

time.