A LARGE NUMBER of people are joining a campaign threatening legal action after Permanent TSB decided to end the interest-only option on their buy-to-let tracker mortgages.

Protect Our Trackers is asking people to fight the bank, saying that the demand by Permanent TSB to make capital and interest repayments on the loans could see repayments rise threefold. The customer can alternatively choose to continue with the interest-only option, but their tracker rate will be terminated.

Dublin solicitor Walter Odlum is spearheading the campaign and told TheJournal.ie that while he is not personally affected, he was struck by the number of people coming to him who have residential buy-to-let mortgages and are going to be affected by the move. Odlum says that while he doesn’t have total figure on the number of people willing to fight, he is still going through a “huge number” of statements of interest.

Odlum is criticising Permanenent TSB’s decision, highlighting the willingness by other banks to consider debt forgiveness:

It’s amazing when you see other banks working with people in difficulty.

A Permananent TSB spokesperson said yesterday that the changes would not affect primary residential mortgages, that thay the move is directed at people with investment properties. However Odlum says that “the code of conduct in relation to mortgage arrears prevents them from dealing with people with residential mortgages”. He claims that the lender’s sole objective is to “get people off their tracker mortgages” and that:

Permanent TSB is relying in part on the customers’ inability to organise themselves in sufficient numbers, and it is important to get people on board.

Protect Our Trackers estimates that Permanent TSB is losing €150 million a year on loans like these buy-to-let products, but that they created the situation by selling the 25 year term mortgages on shorter terms to maximise profits. Odlum says that this latest move will see the bank recoup “€50 million for every one percent increase they save on tracker mortgages”.

The lender says that it is “entirely withing our rights in doing so, and will defend any actions taken on that basis”. But Odlum says that he has spoken to leading senior counsel on the issue, and that the move may constitute legal action.