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

Interesting, I was told something similar, albeit under a different context. I thought the whole point of this exercise was to allow Ulster Bank to exit the market. Although if they are sticking around they won’t have the offsetting feature to deal with.

Regarding the point that fliball123 made, you can still use the pay and redraw feature which admittedly is not as good as the offsetting feature but can still be used to reduce your interest exposure.

Just wondering has anyone cleared their mortgage after receiving the payment and if so have you received your deeds of your house yet

i owe 128000 and have 129000 in the current account. What do i have to do to minimise my interest. Withdraw current account money (129000) and let them close it? Then put back in less than what i owe, thus paying minimal interest? So if i owed 125000, put 123000 in against it and pay interest on 2000?

No you have to reduce your Mortgage. And get them to reduce your repayments over the term. It means paying down(giving them the money in the current account) but you can the redraw it if you need it again.

But only way to reduce interest after 23rd of May is to reduce your mortgage.

If I am reading this correctly this is a much much better scenario for everyone than the portfolio being sold to companies like Pepper

Thanks for sharing Shanoh. I would of thought it was either taxable or not. Not sure why there is a "decision" to make. I hope they decide favourably. Will make the payment fairly meaningless as compensation if taxed.

In fairness to Revenue, they where blindsided by this. No consultation or even notification from UB. They have asked punters to get information from UB about the payment and how it works. UB should at very least had all that ready to go to Revenue as soon as announcement was made.

I have used the payment to redeem so will struggle with any tax bill. But if I waited any longer I'd of been paying interest. Took the gamble. But with tax there are often ways to offset or reduce that bill. Would of been good to know the full ramifications before offsetting ended and interest had to be paid.

@kenif Do we know that for certain? UB must have informed, and possibly worked with the likes of the Central Bank and the banking authorities when they were coming up with this solution. There’s no way those bodies found out about Ulster Banks solution on the same day that us customers did.

Would revenue not have also gotten wind of this?

@rameire I think you’re right, it’s not going to happen overnight and even if everything goes smoothly for them (which I’m not sure is guaranteed) it’s still going to take time.

Plus in the Irish times article there was this;

“Asked how many loans remain on Ulster Bank’s books, a spokeswoman said the lender could not comment on future sales. However, she said: “Following conclusion of all agreed loan sales there may be a minimal number of loans that may remain on our balance sheet.”

So what happens to those loans? Do UB need to stick around and manage those?

I’m anxious as to how the Pay and re Draw will work. No reply from Ulster contact now my Offest has gone to Dilosk?

Not sure how you are trying to contact them. But from my experience the online stuff goes absolutely nowhere. Applied for redemption figure early Feb. Rang them end of March and they hadn't even got the request.

Ring 0818 210 260. Even then it depends on who you get so don't wait. If it hasn't happened when they say it will, ring again, and again. The mortgage is not meant to go for 2 months at least so it is still up to Ulster Bank to do this for you.

Sorry to hear that, a lot of stress and hassle. Are you part of the redress scheme? I can't see how that would stop a bank from letting you pay down the mortgage. Would they not jump at that.

The concern is the redraw. You have to have valid home insurance. Could that be an issue? Will the rebuild be completed before you intend to redraw?

Deals are usually provided in situations where the borrower really has no hope of repaying the loan. Usually you'll be deep in arrears at that stage. Then they'd ask you to provide details of your financial position. It'll be clear very early on that you have the means to pay off your debt. In short, why wouldn't they want your debt?

Given the above, the fact the collateral has depreciated really won't come in to it. The only way to make that a factor would be a strategic default. Very correctly you've not suggested doing this. You'd end up still owing the money, you'd have wrecked your credit history and would not being able to borrow in Ireland for at least five years.