Ulster Bank/First Active Offset mortgages, here's the answer to previous thread!

paul321123

I have been using the offset so I don't pay interest, I have enough to cover my mortgage in this, when I receive my gratis payment in January is there anything stopping me from paying down my mortgage and hence make a few profit from what I have been told I would receive. Eg. Say mortgage is 40k, I have enough in my account to cover this, say the offer me 10k gratis could I just pay my mortgage down so 49k mortgage - 10k gratis +30k from facility, sorry if this is long winded but I hope you can understand what I mean.

phormium

https://www.boards.ie/discussion/comment/121430722#Comment_121430722

I don't actually understand what you mean 😐️

Is you mortgage 40k now, where is the 49k figure coming out of?

Edit - on re reading, do you mean just clear off your mortgage using the 10k payment plus 30k of your savings? If so no reason why not. I intend paying mine off as soon as I get the payment.

paul321123

Sorry that was a typo, say 40k mortgage outstanding, offered 10k gratis, so would I be correct in saying that I could add 30k and complete my mortgage, sorry for the confusion

phormium

https://www.boards.ie/discussion/comment/121430774#Comment_121430774

Yes, just get a redemption figure once you have received the money, transfer however much they ask you for from savings to mortgage and your deeds will be yours, well after they process it anyway 😀 Intend doing the very same thing myself.

paul321123

That sounds great, I was holding of paying down my mortgage but decided to hold on until this was all sorted out, it has worked out well for me if I can do that

phormium

https://www.boards.ie/discussion/comment/121430814#Comment_121430814

Same here, could have cleared it ages ago but paying no interest so thought I'd hold on for a while, advised someone else who wanted to clear theirs months ago to hold on for another while! They might owe me a drink 😂

paul321123

I think he need to buy you more that one drink. We're will the gratis payment be made to, eg facility account or savings account or do you need to give them another current account details,?

aoraki

https://www.boards.ie/discussion/comment/121430587#Comment_121430587

Without knowing your exact figures, on the face of it that sounds like you've been seriously short changed there. If you have for example 50 payments left and you are saving 225 per month in interest payments that comes to over ¢11K. I'd seriously question how they got to that figure of 7300.

I haven't seen the format of the offer letter yet (still awaiting mine) so I don't know what level of detail they are putting in there and exactly how they are arriving at the payment they are offering you. The interest calculation they are doing is central to the whole thing and I'd want to be seeing exactly what this "yield curve" entails and how it is used. I'll wait and see what my own offer looks like before I make any further judgements. But you'd hope they would be transparent as possible in this regard.

I don't think there is anything stopping you from creating a case with the Banking ombudsman, or engaging the services of a financial advisor. By the sounds of it there might be a few going down that route. I might be one of them myself, who knows.

johnreddington

Our life savings are offset against the mortgage have paid no interest for years i am looking for others to come forward and take a class action against ub

johnreddington

I'm looking for other's who have a similar mortgage as ourselves to join together in a class action against Ulster bank

DB2023

No such thing as class action in Ireland

DB2023

I'm waiting on my letter. No idea of what offer will be. Some serious variation on here. I've 68 months left. Now owe 109000 but have had loan covered for last 2 years in current account so no interest charged. If they offer me interest saved till mortgage ends I'll be telling them to f off. Part of these mortgages was a facility that if you remortgaged for a new family home you would get your offset tracker for the new mortgage(but only the amount of you original mortgage on these terms). This part would be very valuable to some

phormium

https://www.boards.ie/discussion/comment/121430858#Comment_121430858

Don't think that info is out there yet, maybe it's in the FAQ on UB site, I haven't looked, I'm sure they will clarify that bit before January.

TheBaldyBuddha

https://www.boards.ie/discussion/comment/121430957#Comment_121430957

Considering they claim to have doubled the figure they expect you to save.

I got mine today, Still 9 yrs left and TBH not used the offset facility much as have not been in a position to do so. But was planning on placing a large sum into the account in January due to Inheritance. How can they calculate without taking into account future feasible large sum lodgments.

Also the part in the FAQ saying yes they can remove the offset element quoting their T&C i drew down my current account mortgage from FirstActive and when Ulsterbank took over they changed it to an offset without any prior correspondence. I recall having issue with them placing two small top ups into one new account without any info beforehand, It wasn't until i called they informed me.

Come to think of it now the acc num on the letter is only for my main Mortgage and the other Offset top up account isn't quoted maybe i get another letter for that one 🙏

DB2023

What savings account are you talking about? UB closed all these 6 to 9 months ago?? Current and mortgage accounts only...

aoraki

https://www.boards.ie/discussion/comment/121431158#Comment_121431158

You can offset your mortgage with up to 4 accounts. And those accounts can be either Current or Savings accounts. I am offsetting my mortgage with a couple of savings accounts myself, I don’t have a current account with Ulster Bank.

phormium

https://www.boards.ie/discussion/comment/121431151#Comment_121431151

The mortgage name was changed to Offset before FA amalgamated with UB, not sure if it was while they were both under RBS umbrella or not but definitely not after the merger, there were some minor changes to benefits on that change relating to repayment types, small issue but it was all pre UB

phormium

A person could still have their facility (current) account and linked deposit accounts open with the offset and indeed should at least have one as otherwise there is no way of actually getting the offsetting benefit, those accounts were not closed.

DB2023

They closed my saving account and moved my savings to current account?? Told me all savings accounts were closing. Now I'm assuming if you had no current account they couldn't do this. Really are a law onto themselves. I'm also assuming the Central Bank must have signed off on this plan ? They can't be doing a solo run after the shite they got into previously?

aoraki

Yeah, it seems arbitrary to be honest. I was well over 10 years into my mortgage before I started using the offset feature of my mortgage, but I am fully offsetting the mortgage now and have been for over 3 years. If this development had happened just a couple of years ago they would have considered me a non-user of the offsetting feature and would be offering me the bare minimum.

Who is to say that in the next couple of years other people that are currently not using the offset feature would start to use it more and more and get into a position where they can fully offset? Some people still have 20 years left to run on their mortgage term, a lot can happen in that time.

I think some people banded together when the tracker mortgage scandal broke. Maybe the same will happen here if enough people are unhappy with what Ulster Bank are doing.

joeymcg

I was the same

phormium

https://www.boards.ie/discussion/comment/121431226#Comment_121431226

Odd! I haven't heard of that as an issue, shouldn't have happened, I still have 2 savings accounts open along with the current/facility account, never heard a word from anyone about closing them. Speaking to another friend yday and she has the max amount of savings accounts and was working with UB until they closed, we were talking about the accounts and no mention of any issues with keeping the accounts open.

DB2023

Agree. People with considerable time left really should get financial advice. The benefits you could be losing are potential huge. I reckon with the offset I'm saving 6k a year on interest currently (obviously a lot less when rates were much lower). But how do you price that in? Who knows where rates will go over next year, never mind 10+ years

coughlsu

Hi everyone,

got my letter today. We were offered minimum 5k. Mortgage is 110k with 12 yrs left. we never used the offset much HOWEVER, recently I’ve been diagnosed with serious illness and we got financial advice. We were advised to move savings into mortgage account to offset. I moved 20k in July and have shares worth 25/30k I can move in January. (I can’t cash them in until then). Future shares worth a further 15k could be put in 2026. Based on this I think our future savings would be a lot more than ulster predicted. How do I start to challenge the 5k?? Is there a date when you have to move your saving in by in order for them to consider it??

(apologies I’m clueless- got mortgage in 20s and didn’t even realise what offset was )

paul321123

All savings accounts were not closed, I have facility and instant access account still open

fliball123

Awaiting my letter but everyone who has this type of mortgage needs to get together the only fair way for Ulster bank to get out of this obligation and its a legal entitlement to the mortgage holder is to give the full amount that can be offset. They also need to make sure its measured for the full length of the mortgage as if your paying off more than the amount you can reduce your payments and elongate the mortgage period back to its originally end date. They also have to factor in the amount in your facility as if you have 50k in it you can put that in your account and then the interest on this will be saved also. Those who have not availed of the one time move should also look at this I fortunately moved about 3 years ago so it doesn't apply but if you move and have a bigger mortgage it means by offsetting you are saving more on interest.

I mean everyone here got these mortgages back in the period of 2000 and 2007 they were no longer available after this so its an older cohort and no doubt they will have parents who are close to end of life which means some sort of inheritance sooner rather than latter (I know that is a cold way of looking at things but it is a real factor) not to mention some peoples pensions with a lump sum kicking in.

Questions for Ulster bank would be as follows

How can Ulster bank realistically base 4500 (possibly 9000 mortgage holders if bought as a couple) persons future finances into one sum.

How can they predict a competing interest rate which they are basing compensation on, I mean back in the 80s we were hitting nearly 17% for mortgage interest and then we have the opposite of this in that we have just had a period of all time low interest rates (0%) for about a decade and now they the rates have ramped back up very very quickly. How anyone can realistically pick this figure and stand over it is nearly impossible and the person who has will really need to explain it..

Any solicitor should be able to argue this I wouldn't be cashing any cheques yet maybe use the 250 and consult a solicitor but it is a good idea to keep ideas floating in here as if 4500 mortgage holder or a decent % go through the one solicitor and make a big enough stink Ulster bank will have to come back to the negotiating table with a bigger sum.

Jim2007

https://www.boards.ie/discussion/comment/121431158#Comment_121431158

Saving account, current account and mortgage account are just generic names like car, van and lorry, so you need to know exactly what financial products were closed and what ones the poster is referring to. If is possible there are financial products open that people would consider to be savings accounts at this time.

phormium

https://www.boards.ie/discussion/comment/121431465#Comment_121431465

They are offering though that 'pay and redraw' facility which while not as functional and a more basic sort of offsetting does kind of the same job if you have lump sums to deposit. This is something that was available by several banks on different mortgage types, you lodge a lump sum directly to the mortgage account and it kind of stays there as a credit until you want it again. The benefit is you are only paying interest on net outstanding balance so while your mortgage is say 100k and you lodge 20k that you might want to redraw then pay interest on net 80k until you take it out again.

It's not as convenient as the offset facility account where you could hold any amount and do day to day transactions, I'd imagine you would have to keep the credit balance below the outstanding mortgage or it would trigger redemption of mortgage but it's still a way to save interest.

Edit: Got my letter this morning, lot of reading but bottom line is €5,250 as expected, I used my offset to it's best but I have a very small balance and only a few years left so I will clear fully in January.

phormium

OK scrap all my last post, I seem to have misunderstood their 'pay and redraw' option, that seems to relate to the old 'available facility' amount, I had read somewhere that it was where you could lodge and withdraw, will have to read up more!

Actually on reading to next page I'm still a bit confused, are they referring to just the amount you drew down on the available facility or to any extra random lump sum amounts?

kerryjack

I do find it a bit odd that this is all done very quickly and moneys paid out in 4 or 5 weeks coming up to Christmas and they might think or hoping people will just take the Money and be too preoccupied with Christmas to start complaining like I said last evening I was happy enough but looking online there is plenty people not so happy.