Mr. Stefan Goor:

We did diligent research on mortgages. We looked into the various options on how the different types of mortgage worked and we went to a broker for some extra reassurance and in case we had questions. At the time we got a 60%-80% loan to value mortgage at a particular rate. Shortly after we took out the mortgage that rate was cut but we did not receive a reduction in our payments. This seemed contrary to the general understanding of variable rate mortgages. We queried it with the broker who also seemed surprised and was not familiar with that scenario but the bank in question suggested that this was available only to new customers. Since we took out the mortgage there have been four cuts, totalling 0.6% and we are currently paying a €100 per month more than a customer who would take out the identical mortgage today. Over the term of the mortgage we will be paying approximately €30,000 more than somebody who got an identical mortgage today. This is only a comparison between our mortgage and someone with the same lender who took an equivalent mortgage. If we compare it with the eurozone average that Mr. Burgess spoke about we are paying almost €100,000 more over the term of our mortgage than someone on the average eurozone rate.

Unfortunately, we cannot switch. Recently I became self-employed, as I was in the fortunate position of starting a company with some colleagues, but that prevents me from switching mortgage. We would also like to go to a fixed rate but the fixed rates available are not appealing, especially when one considers that elsewhere in Europe we could get a ten year fixed rate at approximately 2%. We feel that what is going on is unfair. New customers get better rates than existing customers. Even existing customers are on different rates and are treated differently. The banks want to attract new business but show no concern for existing business. Competition will not fix this for us. If another bank comes in we cannot switch. If a new bank comes in it may act in the same way. Not all banks act in this way but without some intervention they could. We believe this is a breach of the consumer protection code. We have made a complaint, which was dismissed and we are currently in the Financial Services Ombudsman, FSO, dispute process but that is a very long and time-consuming process and many people would not have the time or be able to spare the effort to do it.

Section 7 is very important and would save many people from this unfair scenario. I thank the committee for the opportunity to raise this and the Fair Mortgage Rates Campaign and Mr. Burgess in particular for representing so many mortgage customers.