Permanent TSB decision to terminate interest-only periods

A group of Permanent TSB (PTSB) buy-to-let tracker mortgage customers are to challenge a unilateral decision by PTSB to terminate the interest-only period of their mortgages.

Since November 2010, PTSB’s buy-to-let customers have been informed that they must change to capital and interest repayments or they will lose their tracker rate. PTSB says that this is in line with their mortgage terms and conditions.

Customers unable to pay the capital and interest repayment are offered interest-only at a higher variable rate, intially at a preferential rate of 3.1 per cent for two years, thereafter subject to change, and will lose their tracker rate.

We have received advice from a leading senior counsel who is of the opinion that PTSB’s decision to terminate the interest-only period may constitute a breach of their agreement with customers.