Banks to face ‘aggressive’ action over tracker mortgage scandal

David Hall, CEO of the Irish Mortgage Holders Organisation

An advocacy group for people who lost their homes as a result of the tracker mortgage scandal will take “aggressive” action against banks.

It is estimated by the Central Bank that more than 20,000 people have been affected by the scandal, whereby a person was not allowed to return to their tracker mortgage after a period of paying a fixed rate.

Approximately 23 people had their homes repossessed as a direct result.

It is understood the Irish Mortgage Holders Organisation will seek an injunction against several banks, to stop them selling these repossessed homes.

Letters have already been sent to banks by the group requesting that the repossessed homes are not sold until the tracker mortgage scandal has been fully investigated.

If this correspondence is not responded to, or its suggestion rejected, an injunction will be sought.

David Hall, CEO of the organisation, would not comment directly on the legal threat but told the Irish Examiner his advocacy group would take “aggressive action” against the banks.

“We will continue to protect our clients’ interests and where family homes have been taken from clients by the banks, following them have stolen from them in the tracker scandal, we will take aggressive action.”

It is understood the banks have until the middle of the week to respond to the letter.

The scandal dates back several years, when home-owners on tracker mortgages went on a fixed rate for several years but were not put back on their trackers after this period.

As a result of this change, some people were unable to serve their mortgages, fell into arrears, and had their homes repossessed.

The issue of the repossessed homes came to light recently when one of the affected parties realised their property was lying vacant even though the bank had repossessed it a number of years ago.

It then emerged that AIB wrote to one of its tracker victims offering to sell back the house repossessed two years ago at open market value.

In a letter, the bank is understood to have offered the customer several options including buying back the home at market value, with the bank clearing any remaining balance on the mortgage account; applying for a new repayment scheme on “the corrected mortgage balance”; or selling the property, clearing any remaining balance.

A spokesperson for AIB said a tracker review is ongoing.

“To date, 97% of the 3,200 customer accounts identified as impacted have been paid redress and compensation and this process is progressing.

“The tracker review is ongoing and our expectation remains that work will continue into 2018. Our review will be fully complete when the Central Bank concludes its own assurance work,” said the spokesperson.

This follows advice from the governor of the Central Bank, Philip Lane, that people affected by the tracker mortgage scandal could go to the courts or to the Ombudsman as he did not have the power to help them.

He was speaking at the Oireachtas finance committee, which has called the banks and regulators to account over the scandal.

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