A hundred landlords and a coalition of landlord bodies including Landlord Action, the Good Landlord Campaign and members of the network Property 118 are preparing to launch a class action on the basis that whilst there may be explicit terms in the mortgage document allowing the bank to increase the margin, this clause is inherently unfair.
Following a meeting with a barrister early next week, a second round of recruitment to the class action is expected, with residential as well buy-to-let borrowers encouraged to join.
Alexander told readers of a discussion forum on the rate rise he had recruited a Landlord Action litigation solicitor: “Landlord Action has always fought for the rights of landlords and hates to see landlords being bullied by the government and banks. They are in court every day on behalf of landlords and they agree something needs to be done.
“Landlord Action has a team of legal professionals who will be able to assist in bringing a class action on behalf of landlords against the Bank of Ireland.”
In a cautionary note for advisers, the solicitor, Justin Selig, said a second option for affected landlords was to bring a claim against a solicitor or broker for failing to highlight the terms at the time the mortgage was taken out.
One contributor to the forum thread, Alastair Nicholls, said: “I also suggest that everyone files a complaint to the intermediary who sold the Bank of Ireland mortgage to them for mis-selling. We thought we bought a base rate tracker product, not something where the Bank of Ireland could make up the interest rate whenever they felt like it.
“That ability of the Bank of Ireland was never explained by the intermediary; hence it was mis-sold.”
Alexander replied on the thread: “I don’t recommend registering complaints with intermediaries at this stage. We need them on our side, the last thing we need right now is more enemies.”
On 28 February, Bank of Ireland doubled its tracker rate for 13,500 buy-to-let and residential customers and has subsequently attracted criticism from the chairman of the Treasury Select Committee, Andrew Tyrie.