Bank made an error and are now trying to rectify it. Where do i stand?

the magician

O.k this could get a bit long winded but here goes.
Got a letter from the bank on friday stating that after a review of our mortgage account an error was made( bank inititiated this review , we knew nothing about it).

Apparently when we came off our fixed rate in dec 2009(fixed for 3 years) we should have reverted to a tracker. (ecb + .95%). but we actually ended up on the standard variable rate (2.7%) which was a good bit higher.Not sure but the tracker rate would have worked out at 1.95%)

I remember at the time when the fixed period ended thinking we should be on the tracker but assumed what the bank were telling us was correct.

We spent 4 months on the standard variable rate from Jan 2010 until April 2010 then fixed for 2 years (@3.15%) as there were some good deals and compared to the standard variable rate it was the right decision as we are now fixed lower than the standard variable rate.

The good news is the bank has now told us that from jan 2010 till april 2010 we are being credited €800 to our mortgage account based on the fact we should have been on the tracker. Also when our current fixed contract ends we will revert to The tracker rate of ECB +.95

Judging by the amount credited to our account we were overpaying interest by about €200 monthly. And now that we are fixed we are payin about €240 over what the tracker rate would be costing.

I'm sure this in itself is pretty good that the bank made an error and are now rectifying it.

The bank has stated do not hesitate to contact them if we have any queries or complaints and that we also have the right to contact the financial ombudsman.

The crux of the matter is I know that if I had of been on the tracker rate from jan 2010 we would not have fixed in April '10.
So due to the banks error we made a decision based on it.This is costing quite a lot more than the tracker rate would be at the moment and also the past 12 months.

Is it worth pursuing this , or should we just be thankful that we're getting the tracker rate after the fixed rate?

I'm going to give them a ring on tuesday and see what happens.
anyway Sorry about the length.Appreciate you taking the time to read.
Any opinions?

creaghadoos

first thing to tell them is that if they had not made the error the money would be in your pocket therefore a credit against your mortgage is not good enough. i would ask for a cheque.

i had a similar type of thing happen me in the north where i paid off loans early and the bank made a mistake. after they reviewed this years later i got back any money owed plus interest, which i was entitled to under some european directive.

write to them and let them know that you are willing to go to the banking ombudsman if you are not satisfied.

ravima

I'd be inclined to go back to them and ask to be put on the tracker from whenever you took out the fixed rate, as had you been given the correct information (not advice) you would have decided to run with tracker and not fixed rate.

I say information as whatever about giving incorrect advice, there should be no issue with giving correct information. That is a statement of fact, advice is more an opinion. a fact cannot be wring, but an opinion can