Q&A Dominic Coyle

Bank of Ireland chasing ‘phantom’ €1.90


I am in the very lucky position of having recently cleared my mortgage but on Friday I received a call from the “Distressed Mortgages” section in Bank of Ireland to advise me that my mortgage was in arrears – to the sum of €1.90.

This is not a joke I genuinely received this call.

When I explained that my mortgage was cleared and any figures provided would have come from Bank of Ireland so that, if there was a miscalculation, it was Bank of Ireland’s responsibility, I was again advised that my mortgage was in arrears.

The irony of the figure of €1.90 being the amount seemed lost on the individual I spoke with.

Ms S E, Dublin

You’re right. Everyone’s first impression would naturally be that this is some sort of joke. Indeed, when I spoke to the bank, that was one of the first things they asked.

Figures published by the Central Bank last week indicate that almost one in eight mortgages is now more than three months behind in their payments – close to 100,000 mortgages. Almost 30,000 of these are more than two years in arrears and, for this cohort, the average arrears are in the region of €40,000 – that’s just the arrears.

At a time like this, when so many people are living in dread of calls from “distressed mortgage” departments of various financial institutions, the idea that anyone is being pursued over such an insignificant sum as €1.90 beggars belief.

Either Bank of Ireland is so efficient in its operation that it has managed and cleared every arrears case of any substance such that it has the time to be pursuing miniscule sums – that amount to less than what it costs to employ the person to make the call – or, more likely, there is something disturbingly out of kilter with its operation.

But it gets worse. As you say, your mortgage is actually cleared. Just as you bask in the comfortable glow of having the debt lifted from your shoulders, you get a call like this.

Subsequent to your letter, you tell me the mortgage was paid on foot of the sale of your property and that you received a letter from Bank of Ireland to this effect.

Not only did it assure you that your debt was paid, it advised you to cancel any insurance products that had been tied to the property or the mortgage – such as mortgage protection or house insurance.

Whatever the cause of the mix-up here, a spokeswoman for Bank of Ireland has assured me, officially and sensibly, that it does not pursue customers for nominal amounts (such as your €1.90).

The bank is investigating the exact circumstances of this call.

You do note in passing that the bank did also contact you a few days after the sale of your property had gone through with regard to the previous month’s payment, so it could be that there was some timing issue with the money you paid in following the sale crossing into the mortgage account before or after a payment had fallen due.

Of course, that still wouldn’t explain a call in recent days, nor for a sum of €1.90, and not after the bank had assured you the mortgage was paid and cleared.

But, on balance, it does sound, unfortunately, more a case of two parts of the same system failing to “talk” to each other in real time and, as a result, creating a mismatch or confusion which developed a life of its own.

To be fair, given the challenges the banks currently face in mortgage arrears, I’d be inclined to accept Bank of Ireland’s assurance that it does not pursue trifling amounts and that this latest phone call was a screw-up rather than a campaign.

The way of phone banks (including distressed mortgage centres), unfortunately, is that sometimes people make the calls they are allocated without challenge, even in obvious cases like this.

Following your agreement, I have given the bank your contact details and they assure me they will be in touch with you directly over this once they have figured out what happened.

This column is a reader service and is not intended to replace professional advice. Please send your questions to Q&A, c/o Dominic Coyle, The Irish Times, 24-28 Tara Street, Dublin 2, or to dcoyle@irishtimes.com