As the Deputy will appreciate, it is not appropriate for me to comment on individual disputes between a bank and its customers. The 30% rate of mortgage interest relief for those who took out their first qualifying home loan between 2004 and 2008 came into effect with the enactment of the Finance Act in March 2012. The regulations governing mortgage interest relief provide for the granting of the relief due to the borrower by the lender within the tax year.
I am informed by the Revenue Commissioners that to apply the new 30% rate, specific technology developments were required to Revenue’s and to each of the lenders computer systems. While Revenue’s computer system was upgraded in late 2011 the speed of upgrading across the lenders was inconsistent. For that reason in January 2012, as an interim relieving measure, Revenue advised lenders to grant tax relief at the rate of 25% to those entitled to the new 30% rate of relief, given that the 25% rate was already a feature of the first time buyer mortgage interest relief regime and was not dependent on new IT upgrades taking place.
Due to ongoing technology problems, Ulster Bank was unable to implement the 30% rate until the end of 2012 but did pay the interim 25%, as advised by Revenue, throughout the year. In December the bank credited the additional 5%, including arrears, to the mortgage accounts of each customer entitled to the 30% rate. Ulster Bank confirmed to Revenue that it wrote to each customer affected by the rate change offering to transfer the money to a current account of choice.
In regard to 2013, Ulster Bank has assured Revenue that the required IT changes will be implemented in March and the increased rate will be reflected in customers’ loan repayments from April 2013 onward. Any arrears due in respect of the January to March 2013 period will also be paid without the need for any action on the part of mortgage account holders.
However, in relation to the details supplied by the Deputy in respect of this customer, it is open to the person affected to make a formal complaint to the bank in question about the delay in the payment involved. If satisfaction is not received and all avenues are exhausted with the bank, then the customer may take his complaint to the Financial Services Ombudsman.
The Financial Services Ombudsman can investigate, in an impartial and independent manner, complaints from individual customers and small businesses who have unresolved disputes with regulated financial service providers.
The Financial Services Ombudsman can be contacted at:
3rd Floor, Lincoln House,
Lo Call: 1890 88 20 90