What Is A Tracker Mortgage?

A tracker mortgage is a mortgage which follows the European Bank Commission and set by the European Central Bank (ECB) rate. So, in simple terms if the ECB rate increases, your mortgage interest rate increases and likewise if the ECB rate decreases, your mortgage interest decreases unlike a mortgage which is at a variable or set interest rate.

 

The Tracker Mortgage Scandal

AIB, Ulster Bank, KBC, Permanent TSB and other banks have all been involved in the latest scandal whereby customers were switched from tracker mortgages to more expensive variable rate mortgages, tracker rates were incorrectly applied and mortgage capital and interest settlement sums were grossly overestimated. Many customers have been informed and were offered compensation by some banks of a specified sum set out by the bank. The method of compensation currently being applied by the various banks is unclear and it does not take account of an individual’s personal circumstances. No enquiry has been carried out by the various banks as to how in individual has suffered before the banks decided on the compensation amount.

 

Compensation Claims

The tracker mortgage scandal has affected thousands of people around the Country. If you have suffered from mental health difficulties or if you were diagnosed with a recognised psychiatric illness such as depression or anxiety as a result of the financial pressure that you were under and if you would not have been diagnosed had the correct tracker rates been applied correctly, then you could be entitled to take a claim against the relevant financial institution for your injuries and suffering.

 

Case Example

In December 2017 John (not his real name) received a letter from a lending institution to state that he no longer owed the bank €280,000 and that due to a miscalculation on their part, John owed €190,000. In addition, the Bank admitted to incorrectly applying the tracker rules and offered John the sum of €19,000 to compensate him for their error. In acting for John, we took up a copy of John’s medical records and it was clear from an examination of those records that in 2010, John was diagnosed with severe anxiety and depression as a result of the financial strain that the mortgage repayments were having on him at that time. He was prescribed anti-depressants, medication for anxiety and sleeping tablets for insomnia.

 

From reading the medical records it was clear that John had spoken to his GP about the frustration of trying to come to an arrangement with his banks and not having “any luck” in doing so. In addition, he had spoken to his Doctor about the strain that the mortgage was having on his relationship with his wife whom he now separated from.

 

It was clear from an examination of the records that John had no previous psychiatric disorders and that the stress of the mortgage repayment, threat of repossession and the threat of an appointment of a receiver over the property was the root cause of John’s illness. Therefore, John has the necessary medical evidence to ground a personal injury claim against the Bank for the injuries and pain and suffering that has been caused due to the negligence of the Bank. We also took up a copy of John’s file from the relevant bank pursuant to a Data Access request and it was clear from the banks records that John had received numerous phone calls, letters and threats in respect of arrears that further strengthens John’s case. We will keep you updated on the progress of this case.