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A WIDOWED FATHER-of-five from Co Kerry who was overcharged by Bank of Ireland on his mortgage payments is now in a battle to stop the bank from taking his family home.
The bank secured a possession order on 40-year-old Raymond Flavin’s house in Lisselton last year, only to later admit he had been caught up in the tracker mortgage scandal.
On 14 February this year he received a letter from Bank of Ireland to inform him he had been charged the wrong rate of interest on his loan for “a period of time”.
Last year it emerged that thousands of Irish mortgage customers who were entitled to a tracker interest rate on their mortgage were denied the right to one or denied the option of one. Thousands of other customers – of which Flavin was one – were charged a higher rate of interest than the rate specified on their loan documentation.
(A tracker mortgage is a home loan with an interest rate set at a percentage above the fluctuating European Central Bank [ECB] rate. This means that the rate a customer pays the bank can rise and fall depending on changes to the ECB rate.)
In a countrywide review, more than 15 lenders – including Bank of Ireland – were found to have charged up to 15,000 customers more expensive rates.
Despite its recent admission of error, the bank is still fighting Flavin’s appeal against the possession order granted in the Circuit Court last year.
‘Sincere apologies’
In the 14 February letter to Flavin, seen by TheJournal.ie, Bank of Ireland said that as part of its tracker mortgage examination, it had determined he had been impacted because he was “charged an incorrect margin on your tracker rate of interest”.
“This means you have been charged an incorrect rate of interest on your mortgage for a period of time and this letter sets out actions we are now taking to put this right,” the letter continued.
We sincerely apologise for this failure and for not moving you to the correct lower tracker rate sooner.
The letter goes on to say it will move Flavin’s account to the tracker rate set out in his mortgage documentation “in order to ensure that you do not experience any further detriment as a result of our failure”.
It also explains that it will complete a detailed review of his mortgage account to determine any redress or compensation that may be due to him.
“This may take a number of months to complete given the scale and complexity of the review and the need to have our work independently reviewed. We hope you understand why this process will take this time to complete and in this regard, we ask for your patience.”
‘I couldn’t keep them up’
The father-of-five, who is the first person at risk of losing their home and affected by the scandal to speak about it publicly, said he was “shocked” when he read the letter.
Flavin works for his father’s coach company and in 2013, as he was working underneath one of the buses, it fell on top of him causing serious injury to his back. He was in a wheelchair for six months and was out of work for close to a year in total.
“I couldn’t keep up the mortgage payments. I just had social welfare and all that went to keep the family,” he told TheJournal.ie.
He approached the bank to discuss his financial difficulty and his monthly payment rate was eventually reduced, but as he continued to struggle with his repayments, his arrears built up and in 2014 the bank started court proceedings against him.
At this time, he was in arrears of €18,000. Because Bank of Ireland has not told Raymond Flavin for how long he was overcharged, it is not yet clear how much he may have potentially overpaid on his mortgage.
The bus driver has been representing himself throughout the court proceedings as he said he cannot afford to hire legal representation. Civil legal aid is unavailable to citizens involved in property disputes.
“If I had that kind of money to be spending, I’d be repaying my mortgage,” he explained.
In July last year the bank was granted a possession order on his house and he is now in the process of appealing that decision.
Raymond’s wife Trish died in early January of a heart attack. She was 38 years old. The couple have five children – boy and girl twins aged 5, a boy aged 6, a girl aged 11 and the eldest, a 16-year-old girl. He said the house is now “all my children have left”.
‘A huge source of personal embarrassment’
The Central Bank revealed late last year that about 100 homeowners subjected to wrong interest rates have had their properties repossessed.
Solicitor Gary Matthews, who represents a number of clients affected by the scandal said he is finding, on average, that people have been overcharged in the region of €20,000. He said the banks have been writing to people offering to reimburse them and give them compensation of around 10 or 15%, but he is urging anyone affected to also pursue the bank for consequential losses.
He believes the banks must do more to compensate those individuals impacted.
“Banks are writing to people individually and saying due to administrative errors, or whatever, that their account has been wrong and they are refunding their account and giving them small compensation,” he explained. “Banks are not compensating people for the losses they have incurred during the time they were being overcharged.
“What I mean by that is the loss of opportunity to use their money. The loss of opportunity to go away on a holiday, or the loss of opportunity to spend money on their children or the loss of opportunity to spend money on that business they were always thinking about,” he said.
People don’t understand the consequences the overcharging scandal has had on their personal lives. The pressure that this brought to bear on relationships. What we have found is that a large percentage of the cases their personal relationships with friends and families were affected.
Some relationships did not survive, people had to go to family members and ask to borrow money to keep up these payments and that was a huge source of personal embarrassment.
Matthews said the damage caused by this scandal is, in some cases, irreparable as people had already lost their family home when they were informed of the bank’s errors.
“There are strangers living in these people’s family homes now and what figure of compensation should you get for something like that? We are finding in approximately 50% of the tracker cases that on the date that the bank wrote to the people and said they were in arrears, that people weren’t even in arrears when you looked at how much they were being overcharged.
There is one case I have where a bank said this person was €18,000 in arrears – he was actually €55,000 in credit on the right figures. They got an order of possession on his home and he then came to me and they were just in the process of enforcing it and giving it to the sheriff and getting him evicted when he came to us. Not only did they set aside the order, they’ve reimbursed him his €55,000 and we’re pursuing them for consequential losses. He was on the verge of being put out of his family home.
Matthews, who is now offering his services to the Flavin family, urged anyone who received a letter from their bank telling them they were overcharged, to seek legal advice.
‘An epidemic’
Flavin has also been supported by The Hub Ireland, which offers to lend a hand to people with mortgage difficulties. The Hub’s founder Byron Jenkins said there is an “epidemic” of mortgage difficulties in this country.
His is just one of a number of cases involving the tracker mortgage scandal that the Hub’s team of volunteers has come across.
“We had one chap where they’ve repossessed his family home and sent him a compensation cheque of €50,000, with a cover note saying that if he feels the need to sue, cashing the cheque would not negate his right to sue – so he is.
Another two guys about a year ago had cheques in their hands of €9,000 in compensation.
Jenkins pointed out that most people have had no dealings in the courts before and have little understanding of how it works.
“If you look at the court listings, you see there are 100 people up at every sitting. Unfortunately, most of them won’t even turn up as they’re just browbeaten.”
By the end of last year, Bank of Ireland had identified at least 600 accounts where a right to, or the option of, a tracker rate of interest was not provided to the customer in accordance with their loan documentation.
While conducting its review the bank also identified a rate differential, of on average 0.15%, on 3,916 accounts currently on a tracker rate of interest which is not the rate specified in the account loan documentation.
When approached by TheJournal.ie, the bank declined to comment on Flavin’s case and referred us to their latest statement on the tracker mortgage scandal, which was released in December.
In an update last month, the Central Bank said that lenders had identified 9,900 loans impacted by the errors. About €78 million in compensation has been paid out to 2,600 of those accounts.
Financial institutions say they will identify all homeowners impacted by September.
If you have been affected by the tracker mortgage scandal, we want to hear your story. Get in touch by sending a message to trackermortgage@thejournal.ie.
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This is fcuking obscene.
The state/Irish taxpayers bailed out Bank of Ireland to the tune of 4.7 billion euro. As a result of that bailout the bank’s profits last year soared to 743 million euro. And this is how they treat the citizens in return. They rip them off then repossess their houses when they can’t afford the repayments. The state/Irish taxpayers own 14% of Bank of Ireland.
The minister for finance must step in RIGHT NOW and sort out this out in favour of this man.
RIGHT NOW.
DO YOUR DUTY NOONAN.
@Tommy_Bannon: if your expecting any minister in this government to do their job, you’ll be a long time waiting.
@Tommy_Bannon: The courts should step in and help this man, not a politician. No way should a bank be able to throw you out of your home when it owes you money for illegally overcharging you.
But at the same time, I NEVER like to see a politician of any type getting involved in a case directly as it opens up the potential for a world of abuse / populism / favoritism / nepotism etc.
@Kevin McDonnell: as far as I’m concerned they should wipe off the entire debt.
The stress of losing your home is so immense that it’s hard to comprehend unless you are in that situation.
His wife died – presumably because he was unable to pay high mortgage rates did not pay life assurance, this again is the banks fault.
Wipe the entire mortgage. Give this man his home.
@Tommy_Bannon: I couldn’t agree more with everything you have said.
Ffs..allow the Man to grieve..ye heartless c@nts.
@sparky: We still love them, pay them like there is no better people in Ireland unfortunately….
He needs to find out how much he’s been overcharged versus how much he’s in arrears . He might get a clearer picture then .terrible situation to be in ..
That’s a joke
@Jamie: No it’s not, if it works out that sum he was overcharged by is in and around the the amount he’s in arrears by he could be able to make a case that that amount should be written off and he should be given a chance to catch up on the outstanding amount. It’s worth a shot especially since the bank has admitted that they overcharged him but are still very eager to get his house off of him.
I hope the re-procession order is thrown out of court, as the contract is void, with the interest rate being incorrect ( contract law 101 -j ust one of those details that are kinda important to this contract). As for remedy for the incorrect rate, the family should be offered to buy the property at the discounted price the bank had plan to sell at.
@Yiu Fai Lau: Wouldn’t have that much trust in Irish courts to be honest – lack of decency and common sense is a trademark of our jurisdiction…
crowd fund anyone?
@Chris: we crowd funded the bank already
@Chris: Lovely thought and was thinking along those lines but there are many more like this family. Crowd Gather maybe? 200 volunteers outside every branch of BOI on a nominated day or outside the Financial Regulator office?
@Tom Fennelly: Yeah someone suggests helping and you suggest an angry mob. Idiot.
@CeannairBlue: Hey thicko keyboard warrior hiding behind your fake name, I did not suggest an angry mob. I would and will support and help the person more than your ilk with false names would do but if a Crowd Fund were to be formed for every distressed mortgage we would need 40,000 crowd funds. There are people right now considering the lonely final solution and fir many it is to late and the guilty ones are not just the banks but the Financial Regulator and The Minister for Finance , – and a 55 holes with fancy pseudonyms making crass comments on forums
@Tom Fennelly: we don’t know if he needs crowd funding because the bank has been over charging him. Ironically they’ve asked for time something they never give.
You just wonder is this the full story , where is the life assurAnce gone for his wife ? I’m no fan of he banks , they are gangsters . But there is always more to a story . I thought it was mandatory to have this covering a mortgage
@Gary Murphy:
If his wife only died this year, it may not be paid out yet, but more than likely when the man had the accident he couldn’t pay his mortgage probably the life assurance as well.
@Catherine Mc: I assume life assurance doesn’t work where a repossession order is in place or maybe he couldn’t keep up the payments on the life assurance. Lots of people have life assurance with the bank they have the mortgage with.
@Gary Murphy: Mr flavin’s wife only died in January. Probate can take months even a year (my recent experience regarding my mum) no monies will be forthcoming until probate is granted, in the meantime the very minimum the courts should do is put a stay on the repossession order under these exceptional circumstances. Also any arrears on the mandatory life assurance may render it void – i will stand corrected if i am incorrect on this point. Mr Flavin needs to grieve his young wife not have the banks breathing down his neck, i sincerely hope this dreadful situation is resolved.
@Gary Murphy: depends on when he took out his mortgage…. when I first tool out mine I didn’t need any insurance but topped it up a few years later and I did.
@Gary Murphy: Yes it is mandatory for the person with the paying job to get life assurance, not necessarily for the spouse if he/she has no income that contributes to the mortgage payments.
@molly coddled: The banks will not let up when you’re at your most vulnerable. It makes things easier for them.
Well done Journal, great article with one small exception and it is this:
When the boom turned to bust it was generally accepted that the Financial Regulator was asleep at the wheel and this bank had 52 million in preferential loans at “low” rates given to their own executives
So where is the current Financial Regulator in all of this? Where was he on 22nd August when Allianz brazenly declared that they would insure nobody in this country if they had a claim for any amount in the previous five yearshope’s for this country.
@Tom Fennelly: So Journal. Why not publish a statement from the Financial Regulator? ???
@Tom Fennelly: He wasn’t asleep, he knew well what was going on. The collapse was orchestrated, it facilitated the transfer of wealth from the poor to the rich. This was the whole intention.
@Dave Doyle: I agree Dave. My post got snipped of the following that was cut off the bottom: “When the boom turned to bust and Fine Gael were rubbing their hands with glee with the opportunity they were handed they were boasting about how they were going to regulate the banks. They have failed and this case, like many others is a matter for Noonan and the Financial Regulator instead of letters from bank managers and sheriffs .
Fortunately, according to the article, a solicitor is now working on this case. I hope to hear a follow up, Journal. It is simply criminal when an individual can have documentation that the bank has overcharged them, yet be in court fighting to hold on to their home.
@Rathminder: You need to have your bank account forensically checked by an accountant experienced in this matter.
The Hub Ireland can put you in touch with such accountants, they are not expensive.
Isnt protecting the interests of banks the reason Pearse and the boys took to up arms in 1916 or have I missed something?
@Eyepopper: We all missed a lot, especially during last 10-15 years.
They should be locked up for this.
Another scandal here is every scrote in a hoodie can have legal aid for his 100+ convictions but this man has to represent himself. Stop the world and let me off!
@Obi: Thats why we have all estates filled with happy ever after scroties in hoodies..
The banks have been engaged in mortgage fraud for years now. The government know well about it, but turn a blind eye. The banks and vultures benefit and that;s what’s important to the neoliberal government.
The EU have told the government that the mortgage contracts as used by Irish banks are illegal and contravene consumer protection law. The government choose to ignore the blatant illegal actions of banks. But are very committed to following supposed water legislation supposed to be demanded by the EU.
Suicides have resulted by the banks greed, the government have the blood on their hands as well.
The scandal of the tracker mortgage issue has been compounded by the inaction of Banks to their own gain. Meanwhile the Governments and Central Bank that bailed out the banks has stood by and not only has allowed them ignore this known issue for years but also allowed them charge some of the highest variable rates in Europe afterwards. Consumer Protection code ? Don’t make me laugh.
Harsh as it sounds there are 2 separate issues here and cannot be simply linked.
However while overcharge claim is pending bank should suspend repossession or extend the period.
I also wonder what happened to life insurance of his wife?
Worst comes worst I’d be also happy to donate something to his fund to help him get out of it. Poor guy 5 kids very tough situation.
@Tomasz Kuchnik: but without knowing the overcharges amount you don’t know if both cases are linked or not
@lavbeer: Always with the exuses, there’s no excuse for fraud. Fraud is criminal.
But white collar crime is allowed by FG/FF .
I had to move from BOI after nearly 20 years….just one calamity after another with them. Much happier with my new bank.
Kenny, Noonan start looking after our citizens instead of your banking buddies!
Some people, a significant number, have lost their home in overcharging situations and that will continue to happen in the future. The protection and advancement of the interests of the Banks and Bankers come first.
I have seen County Registrars and Circuit Court Judges consistently grant Possession Orders even when the interest amounts are is dispute as a result of over charging. As one Circuit Judge puts it, just pay up all arrears, including disputed interest, charges and legal costs and I may be disposed to seeing what I can do.
Once you are in arrears of more than 3 months, the Bank is entitled to repossess even if all arrears are tendered and paid off.
There is more Consumer Credit protection in buying white goods and a car than in taking out a mortgage.
Banks will cancel mortgage protection policies by lapsing repayment on the monthly mortgage repayments.
The Banks are a hugely powerful lobby group in Ireland. The Banks have FG in their pocket. It is no different with FF.
@Tony Daly: Well said, sir!
It’s reading stories like this that make me think that Benny or wally of whoever he is today might actually have a point… absolutely scandalous! And what’ll Noonan & co. do? Sweet F A!
Wally does have a point. The man is totally right in what he says. His problem is that he says it to often.
Best of luck to the man and well done to The Hub.
The worst thing here is how the bank can rip you off and a simple apology will do but the bloke on the other side get his home taken off him. Slight imbalance there.
The biggest scandal in all this debacle is the way payment protection was swept under the carpet ,lives destroyed by illness/accidents are finding the insurance/payment protection is not valid
@David Dineen: I’ve personal experience of this fraud …. my wife got mugged & as a result of the trauma she developed MS . So we made a claim under the grounds of serious illness … No … it doesn’t cover if it’s the result of a criminal act …. So you then sue under the Criminal Injuries Compensation Act ….. No … she might have developed it anyway
The Government financial ombudsman or regulator as useless as the energy regulator as useless as the garda ombudsman etc etc etc.A Minister of finance 90 years old made a c**k up of NAMA the Grace Inquiry The Hepatitis C blood scandal and he is like the ghost of Christmas past still in the respite home of Dail Eireann. So don’t expect any direction from that stiff dummy working for Frau Merkel. Well FG did take a shilling from the Blind Pension in 1930′sso Mr Noonan won’t worry when he gets his cocoa about piffling tracker mortgages or people evicted etc bloody peasants.I’m all right jack I’ve 40 pensions coming up when I eventually exit from my fantastic career in public service at 100 years old I mean my position as the sheriff of Nottingham Forest screwing you suckers.
@John Dillon: Noonan has a touch of the crypt about him………..well past his sell by date.
I am one of those people. I only got the letter last week. I broke my back literally in two jobs trying to keep up the payments and seven years I am pleading with the bank for help and they ignored me. I applied twice for the mortgage to rent scheme only to be turned down so now I have to surrender the house. Then I get this letter a month ago. I’m worn out from trying.
@Christopher Gardiner: Contact the hub ireland. You will be amazed at your options. It will take you from being powerless to being empowered again.
I wonder why there has been no criminal investigation? This was not just an error on the banks part, they were deliberately overcharging customers, hoping that they wouldn’t find out. That sounds like theft to me. Shouldn’t be too hard to prove either: there were probably memo’s/e-mails on this in their internal systems.
It’s sickening to think we the tax-payers are paying for these banks to stay in business, to do this to people.
This man should engage a good solicitor and sue the crap outta the bank, they’ve admitted to over charging him in court, it would be a done deal win for him. Banks are the bullies again and havent even come close to acknowledging they were wrong in the past so fight fire with fire against them.
“Civil legal aid is unavailable to citizens involved in property disputes.” – Great so if you rape a woman, beat up a stranger after a few pints you get all the legal aid you want but be a tax paying person and get into trouble with the bank and you are on your own.
I can’t see any judge allowing the reprocess from occurring, the bank has to redraw their case as they themselves have completed an act of fraud.
Send this link to Pearce Doterhty ASAP
As if this poor guy and his kids haven’t been tru enough losing his wife and kids their mam.
But I’m just asking ok.He worked for his father’s coach company ok.
And 18k.is not really a huge amount of arrears when you see others owing 60k.
It happened (the accident) on company time and he was on the dole.Could his father not help him out?
Anyhow back to the bank.Go to court because the Bank is very wrong.The compensation should be to clear the arrears and let him start again.They would want to be monsters to take his house back.
@Gerry Fallon: ‘would’ want to be monsters? It’s a bank, no ‘would’ about it. They’d take the oxygen from your blood if they could. I’m having my own account forensically checked right now and should have a report back in the next couple of weeks. Same bank btw.
Very easy to stop these banks & the state in behaving this way. Burn these proposals to the ground.
So this poor man is not entitled to free legal aid. I bet a $cumbag with 100 previous convictions is though! This country would make you sick. Bank of Ireland are disgusting for what they have put this man through.
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