What is the Tracker Mortgage Examination?
Tracker Mortgage Examination FAQs
These FAQs cover the following things:
- The Tracker Mortgage Examination
- The Redress & Compensation Letter
- Redress and Compensation
- Appeals Process Overview
- Making an Appeal
- Regulatory Notices
This document answers questions you may have about the Tracker Mortgage Examination; including the information in your letter and how you can appeal.
1. About the Tracker Mortgage Examination
- What is the Tracker Mortgage Examination?
In 2015, the Central Bank of Ireland announced that it would conduct a Tracker Mortgage Examination of all lenders that provided tracker mortgages in Ireland.
This means that all lenders, including Bank of Ireland, have been asked to examine all of their customer tracker mortgages. Why? The Examination is to work out whether lenders have honoured contractual rights and obligations regarding tracker interest rates and complied with their responsibilities under consumer protection obligations.
- What is this Examination looking into?
It’s looking into four main situations, described below:
- Where tracker interest rates were applied to mortgage accounts but, in breach of the mortgage contract, are no longer being applied to
those accounts or are being applied but in a manner that infringes the consumer protection regulatory framework.
- Where a tracker interest rate margin applying to a mortgage account at any stage that, in breach of the mortgage contract, is higher than any previous margin applied to that mortgage account or applied in a manner that infringes the consumer protection regulatory framework.
- Where customers had contractual rights to have tracker interest rates applied to their mortgage accounts and the tracker interest rates were not
applied to their mortgage accounts at the appropriate and/or any stage.
- Where customers had contractual rights to be offered the option of having tracker interest rates applied to their mortgage accounts and
were not offered the option of having tracker interest rates applied to their accounts.
The Examination aims to identify everywhere these issues occurred across all mortgage accounts for both private houses and buy-to-let properties where the following conditions existed:
- They originated on tracker interest rates.
- They had tracker interest rates applied at any stage during the term of the underlying mortgage agreements; and/or
- The underlying mortgage agreements provided for contractual rights to tracker interest rates or options for tracker interest rates at any stage during the term of the agreements.
The Examination covers the period from when Bank of Ireland first started offering tracker interest rates to 31 December 2015.
- Where tracker interest rates were applied to mortgage accounts but, in breach of the mortgage contract, are no longer being applied to
- What stage is the Examination at now?
The Supervisory phase of the Central Bank’s Tracker Mortgage Examination concluded in July 2019, however, in line with the Framework we continue to ensure that we put things right for customers impacted by our tracker failure. This is an ongoing process to ensure customers affected are treated fairly and consistently.
- I don’t understand the Redress & Compensation letter I got from you; can you explain it more clearly?
The Redress & Compensation letter sets out a number of things:
- It tells you that the tracker mortgage Examination discovered that your mortgage was impacted
- It sets out the amount that you will be paid to put right the failure of overcharged interest; this is what we mean by “redress”
- It sets out the amount that you will be paid in compensation for our failure
- It explains how we calculated the payment due to you
- It gives you guidance on how to submit an appeal and other options available to you.
- I have received a Redress & Compensation letter, what do I do now?
You have a number of options, you can;
*Please Note: If you choose option (c) above and elect to not return the Payment Instruction Form Included in Section 4 of your letter, the payment due to you may be applied to your mortgage account six months after the date of your letter as outlined in the Payment Instruction Form. This payment can be reversed later if you return a completed Payment Instruction Form. If you are required to return a Mortgage Form of Authorisation and choose not to do so, the tracker rate applied to your account may no longer continue to be applied.
- Complete and return the Payment instruction form
- Complete and return the mortgage form of authorisation (if applicable)
- Do nothing*
- I am not satisfied with the outcome of the Examination. What can I do about this?
If you are not satisfied with an element of the Examination with respect to your account you can*:
*Please Note: Picking one of these options does not stop you from choosing another. Also if you are not satisfied with an element of the Examination with
- Request an Appeals Application Pack from the Independent Secretariat
- Submit a complaint to the Financial Services and Pensions Ombudsman OR issue proceedings against the Bank
respect to your account, receiving the payment due to you in no way affects your ability to make an appeal to the Independent Appeals Panels, or either submit a complaint to the Financial Services and Pensions Ombudsman or issue legal proceedings against the Bank.
- I’ve had a letter for one of my accounts but not another. Your letter says “We included your mortgage loan account in the Examination”. Does this mean that my other account was not examined or was excluded?
All accounts that were in scope for review were assessed under the Examination framework. The Bank is contacting all customers where a tracker rate issue was identified that impacted their account.
- I received a Redress & Compensation letter which surprised me because I haven’t had any correspondence from the bank about this before – what’s going on?
The Examination consisted of a comprehensive review of all potentially impacted customers to ensure that any failures on the Bank’s part were identified. This review was then subject to intensive assurance work from the appointed independent third party. Following this, Bank of Ireland is now engaging with all customers identified to date as impacted as part of the Examination.
- What do I need to do to receive the redress and compensation amounts detailed in my Redress & Compensation letter?
To facilitate us in making the payment you will need to complete the Payment Instruction Form enclosed in Section 4 of your letter, ensuring that only one option is selected and return the form to us within 6 months of the date of your letter. If there are arrears on your account the redress payment will first be applied to reduce or clear the arrears and the balance paid using the method you choose on the Payment Instruction Form. The compensation payment will be paid to you in full regardless of whether there are arrears on your mortgage
- If I want to have the money due to me to be paid into a current account, why do I have to return a current account statement with my Payment Instruction Form?
If you choose to have your payment made to a current account, the Bank requires that the current account be held in the name of at least one of the borrowers on the mortgage account. A recent original current account statement (or e-statement) must be returned to Bank of Ireland together with the signed Payment Instruction Form. This precaution is intended to ensure that the monies are paid to you and not to any unauthorised individual.
- I wish to have the money due to me paid into a bank account held abroad, is this possible?
Yes you can have your payment made to a bank account held abroad provided that the account is in the name of at least one of the borrowers on the mortgage account. A recent original current account statement (or e-statement) must be returned to Bank of Ireland together with the signed Payment Instruction Form. Bank of Ireland will make payment in Euro regardless of the denomination of the payee account and will not apply any commission or administration charges to this transaction.*Please note: International money transfers are often subject to charges by the receiving or intermediary bank. These charges are deducted from the amount received by the receiving Bank and/or intermediary bank and relate to their role or services in facilitating the transmission or receipt of a payment and can vary. Some foreign bank charges can be high with no maximum applying. The effect of these charges, if levied, is to reduce the amount you ultimately receive. You are encouraged to establish the nature and level of any likely charges with the counter party bank if considering payment to your account held in another jurisdiction. In addition you should be mindful of the effect of exchange rate movements.
- How did you work out the compensation? How do I know that this amount is fair?
Compensation reflects the nature and severity of the impact with reference to a number of factors such as if you lost ownership of your mortgaged property as a direct result of our failure, or if the Bank took legal proceedings against you as a result of arrears on your impacted account. The framework of the Tracker Mortgage Examination involved appointment of an independent third party to oversee all aspects of the Examination including calculation of redress and compensation.
- Does the compensation figure take into account my individual circumstances?
The compensation amount provided to customers has been calculated with respect to a number of characteristics of each impacted account. The methods we used to work out the redress and compensation calculation have been reviewed and approved by an independent third party. If you feel this figure doesn’t adequately compensate you, you can submit an appeal to the
Independent Appeals Panels. Details on how to make an appeal are set out in section 4 of this Frequently Asked Questions (“FAQ”) document.
- What is the ‘time value of money’ and how did you work it out?
The ‘time value of money’ amount represents a payment to reflect additional financial loss you suffered by not having access to your money that was used to pay interest at the incorrect rate. The ‘time value of money’ portion of the redress payment seeks to put this right. It is based on the European Interbank rate.
- What about TRS?
TRS stands for Tax Relief at Source. The TRS system began on 1 January 2004. The tax relief on mortgage interest paid on qualifying mortgage was only available up to 31 December 2020. Lenders, like Bank of Ireland, gave borrowers the benefit of tax relief on the amount of mortgage interest they paid, on behalf of the Revenue. The Bank did this by reducing the mortgage repayment by the amount of income tax relief you were entitled to that was based on the interest you paid on your mortgage loan each year. The Revenue then reimbursed the Bank for the difference. As the Bank charged you too much interest, it also reduced your mortgage repayments too much; and the Revenue also reimbursed the Bank too much. The Bank has calculated the difference between the amount of TRS you received (and for which the Revenue reimbursed to the Bank) and the smaller amount of TRS which you would have received if the Bank had charged the correct, lower amount of interest. The Bank will refund the Revenue for the difference, at no cost to you. No further action is required by you.
If you have any queries about your TRS entitlement, please go to revenue.ie.
- I don't want the payment applied (in part or whole) against my arrears. Why have you done this?
Under the Redress and Compensation Scheme operated by the Bank, the redress element of the payment due to you is paid to you firstly by reducing or clearing your arrears (if any) and the remainder is then paid to you, along with all of the compensation amount, as selected by you on the Payment Instruction Form.
- I don't want the payment applied (in part or whole) against the residual debt on my account. Why have you done this?
Under the Redress and Compensation Scheme operated by the Bank, the redress element of the payment due to you is paid to you firstly by reducing or clearing any arrears on your mortgage with any remainder reducing or clearing the residual debt balance (if any) on your account. Any remaining amount is then paid to you, along with the entire compensation amount, as selected by you on the Payment Instruction Form.
- How come the margin difference always seems to favour the Bank and not the other way around?
A margin difference generally happens when a discounted tracker rate was not implemented properly. The purpose of the Examination was to identify accounts where customers lost out because of this. Accounts where it worked out entirely to the customer’s benefit are not deemed to be affected for the purposes of the Examination.
- Why has this process taken so long? Other institutions have made redress and compensation payments months ago.
The Tracker Mortgage Examination is a complex process and we have worked on all aspects of the Examination as promptly and comprehensively as possible.
- Why do I have to sign the MFA form to keep the tracker rate that you’re telling me I was entitled to all along (and which has since been applied to my account(s))?
Impacted customers had their rates changed as soon as we identified that they were impacted. We did this to prevent any further detriment to them. An MFA is required to be signed and returned by each customer to both formally acknowledge and accept this rate change.
- I have made a complaint to the Financial Services and Pensions Ombudsman but have now received a Redress & Compensation letter - what do I do now?
The fact that you have submitted a complaint to the Financial Services and Pensions Ombudsman or commenced legal proceedings against the Bank does not prejudice our offer to pay you redress and compensation as described in your letter. You can keep pursuing a complaint with the FSPO or continue legal proceedings and receive the payment offered.
- The Bank has issued legal proceedings against me and now I’m being told I was overcharged, what happens now?
The fact that proceedings have been issued does not prejudice our offer to pay you the redress and compensation payment as described in the Redress & Compensation letter. In line with the principles of the Examination these legal proceedings have been paused for all accounts identified as impacted. Our Arrears Support Unit will speak to you to work out how best to manage your
account in future.
- I am thinking of making a complaint to the Financial Services and Pensions Ombudsman (FSPO) or taking an action in Court. If I put off doing so until I submit an appeal to the Independent Appeals Panels, could the Bank use that delay to object to my complaint to the FSPO or pursuing a court action?
The Bank will not challenge any complaint you make to the FSPO or Court action taken within 12 months of the date of your Redress & Compensation letter, on the basis that time has elapsed since the cause of your complaint or court action occurred.
- I want to get copies of all records relating to my impacted account(s) - how do I get them?
Requests for copies of personal data held by us can be made to our Tracker Mortgage Examination Team free of charge by writing to us at Bank of Ireland Tracker Mortgage Examination PO Box 400, Tralee Co. Kerry.
- Was my account included in the examination?
All mortgages were looked at as part of the examination including closed mortgage accounts.
- I switched my mortgage to another lender as a result of losing/not being offered a tracker rate. What is Bank of Ireland going to do about this?
If you switched your mortgage to another lender to avail of a lower rate on a like-for-like basis, and the tracker-related issue which impacted your account influenced your decision to switch, please contact our Tracker Mortgage Examination Team. The Tracker Mortgage Examination team can be contacted on 0818 200 382 or you can write to us at Bank of Ireland Tracker Mortgage Examination PO Box 400, Tralee Co. Kerry. The Tracker Mortgage Examination Team will outline the process to put things right for you.
- What are you going to do to fix any damage caused to my credit bureau score?
We’ll correct the credit rating of impacted customers as soon as possible. Copies of an updated credit rating will be provided, on request, free of charge to all impacted customers.
- Is the Central Bank involved in the appeals process?
In December 2015 the Central Bank announced that it would conduct a Tracker Mortgage Examination and asked all lenders that provided tracker mortgages in Ireland, including Bank of Ireland, to examine all of their tracker mortgages. The appeals process is a critical part of the Examination.
As mentioned in our letter to you, if you are not happy with what we are doing to put right our failure, you have the right to appeal. If you choose to appeal, your appeal will be managed by an independently governed appeals body. The following sections explain how this appeals body is made up, how you can appeal and what you need to do to submit an appeal.
The structure of the appeals body
In accordance with the Examination framework , a two-tier independent Appeals Panel structure has been created. The Panels review appeals made by impacted customers on all elements of offers of redress and compensation. This two-tiered structure is supported by an Independent Secretariat.
The structure of the appeals panels
Depending on the specific circumstances of your account, your appeal will be reviewed by one of the two following Appeals Panels:
Panel A consists entirely of external non-Bank of Ireland members who are appropriately qualified independent professionals. Panel A will address appeals from those impacted customers who:
- Have lost ownership of their mortgaged properties by way of repossession, voluntary surrender, voluntary sale or assisted voluntary sale
- Have had legal proceedings issued against them in respect of mortgage arrears.
Panel B consists entirely of external non-Bank of Ireland members who are appropriately qualified independent professionals. Panel B will review appeals from all other impacted customers.
Each panel will have the following members:
- A Chairperson
- A Financial Expert
- A Consumer Voice – a representative with relevant experience. The role of the Consumer Voice is to ensure that customers are treated fairly and that their interests are protected.
An Independent Secretariat has been appointed to provide administrative support to the Appeals Panels. The Secretariat will provide governance and quality assurance as well as acting as a link between customers and the Appeals Panels. The Independent Secretariat will receive your appeal, give you updates and send you the outcome of your appeal. As part of the
administrative support provided to the appeals process, the Independent Secretariat may request further information from you if required.
How the appeals panels work
Each Appeals Panel will meet regularly. The Independent Secretariat will attend each Panel meeting to help it run efficiently.
Each Panel will review appeals and make a decision, preferably by consensus, but otherwise by majority. Appeals Panel A has the power to review appeals referred to it by Appeals Panel B.
Appeals Process: How to submit an Appeal
What aspects of the redress and compensation scheme/output of the Examination framework can I appeal?
The aspects you can appeal include, but are not limited to:
Please note that you can submit an appeal relating to all or part of the redress and compensation offered to you.
- The period during which we deemed your account to have been impacted. This includes if you switched your mortgage to another lender to avail of a lower rate on a like-for-like basis, and the tracker issue which impacted your account influenced your decision to switch
- The categorization of the impacted loan (e.g. whether it was a principal private residence or buy-to-let)
- The categorisation of the customer (e.g. whether the loss of ownership was as a result of the issues identified)
- The revised interest rate applied
- The level of balance adjustment/compensation or contribution to independent advice as set out in our letter.
- Where loss of ownership has occurred, any additional aspect of the redress and compensation offer.
- How do I submit an appeal?
First, you can request an appeals pack. The pack contains further details on the appeals process and procedures along with a guide outlining what you need to provide in order to submit your appeal and details of where to send it. To get one of these packs, please contact the Independent Secretariat at either 1800 818 797 or email firstname.lastname@example.org.
Appeals Terms of Reference
- What information do I need to provide?
Everything you need to submit an appeal is described in the appeals pack. You can also provide any documents that you feel are relevant to your appeal.
- How long do I have to make an appeal?
You have 12 months from the date of your letter. You can appeal at any time within this period.
- Is the appeal made in writing or by oral hearing?
Appeals are lodged in writing. The Independent Secretariat can send you a pack to complete if you wish to submit an appeal. To do this, please contact the Secretariat using the details provided above. You should complete any forms in full, ensuring you sign and date them then return the pack to the offices of the Secretariat at Independent Secretariat (BoI), c/o Grant Thornton, 13 – 18 City Quay, Dublin 2 D02 ED70.
- Do I need a solicitor to make an appeal?
No, but you are entitled to retain the services of any third party including a solicitor.
- I want my solicitor to make the appeal on my behalf, where will the appeal be held?
Appeals Panels will be held at Grant Thornton, 13 – 18 City Quay, Dublin 2 D02 ED70 and will ordinarily not require an oral hearing. The Appeals Panels have the power to allow oral hearings and to decide whether an oral hearing is warranted.
- What happens next?
Once you have completed and submitted your appeals pack, the Independent Secretariat will confirm that they have got it 5 business days after receiving it. Your appeal will then be judged by one of the Appeals Panels within 40 business days of receiving a fully completed appeal pack.
The Panel may approve or reject all or part of your appeal. If the Panel approves all or part of your appeal it will then tell us to address issues upheld. For example, it might tell us to revise an interest rate, process a refund, provide additional compensation or re-categorise a loan.
The Independent Secretariat will get in touch no more than 10 business days after the Appeals Panel reaches a conclusion. They will explain the reasons for the conclusion and the terms of any offer being made.
- What if I’m still not happy?
If you are not satisfied with the outcome of your appeal, you can choose to either submit a complaint to the Financial Services and Pensions Ombudsman or issue legal proceedings against us.
- Am I eligible to appeal? I didn’t receive a letter but someone I know did.
Only impacted customers are eligible to appeal. An impacted customer is somebody who either had a contractual right to have a tracker interest rate automatically applied to their accounts or had the right to be offered a tracker at any stage. All customers who have been identified as impacted are being sent a Redress & Compensation letter describing any impact identified on their accounts.
If you feel that your account has been impacted, please provide your account details to Tracker Mortgage Examination Team on 0818 200 382 or you can write to us at Bank of Ireland Tracker Mortgage Examination, PO Box 400, Tralee, Co Kerry.
- Consumer Credit Act Notices
WARNING: YOUR HOME IS AT RISK IF YOU DO NOT KEEP UP ANY PAYMENTS ON A MORTGAGE OR ANY OTHER LOAN SECURED AGAINST IT.
THE PAYMENT RATES ON THIS HOUSING LOAN MAY BE ADJUSTED BY THE LENDER FROM TIME TO TIME.