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The successful outcome of the West Brom court case has led another group of landlords to start legal action against two more lenders: Skipton Building Society and the Bank of Ireland.
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The action first kicked off three years ago, when a group of disgruntled landlords teamed up with Property 118 to take the West Brom to court over its September 2013 decision to raise its buy to let mortgage tracker rate from 1.49% to 3.49%, even though the Bank of England Base rate hadn’t risen at all.
West Brom Loses Appeal
Initially the courts sided with the West Brom, saying the lender was within its rights to raise its interest rates, but the group appealed and the case was heard in the Appeal Court last month. This time it was a different story and Appeal Court judges ruled the West Brom had been wrong to put its tracker mortgage rates up.
BoI and Skipton BS in the Firing Line
It was a costly decision for the West Brom, as the lender has been forced to repay £27.5 million of overpaid interest. Since then, the spotlight has been thrown on to the Skipton Building Society and the Bank of Ireland. Crowdfunding has attracted more than £60k to help Property 118 pursue the two lenders, both of whom raised their tracker rates when the Bank of England’s base rate stayed static.
However, it might not be so easy second time around, as both lenders reject the claim against them.
