Q&A

PERSONAL FINANCE:Your queries answered

Will my mortgage be affected if I move bank?

Q

My bank charged me €5 for being overdrawn when a large cheque I wrote pushed me into the red. Funds from a savings account hadn't made it into my account in time to cover the cheque. I've been a customer for over 20 years, my wages go directly into the bank and I even have a mortgage with them.

My bank were mealy-mouthed with me when I pointed out the years I had been with them. I asked them to forgo the €5 charge. They refused. I would like to close my account. I just want to confirm that my mortgage, a very attractive tracker mortgage, will not be affected if and when I move my current account banking elsewhere.

 - Ms M C

A

Your mortgage account and your current account are separate entities. The bank cannot affect your mortgage account - or the tracker rate - if you close your current account with them.

However, the bank will have arranged for a monthly transfer from that account to your mortgage account. Especially after your recent experience, you do not want to find yourself missing a mortgage payment because of the changeover in current accounts.

Another issue is banks' more wary approach to switching in the current environment. While you should have little trouble finding someone to provide you with a current account, you might find more difficulty arranging overdraft facilities or credit cards on that new account.

While you are right that the bank has been incredibly short-sighted, they are under massive pressure and you should think carefully before you proceed.

Useful information on codes of conduct regarding switching is available from the website of the Irish Bankers' Federation (ibf.ie)

Which societies are in the guarantee scheme?

Q

I have investments in various building societies, all in fixed term accounts. Some are due to mature soon.

I know that the Government's guarantee scheme is to end on September 29th this year but I see that there is to be an extended guarantee for five years.

How can I find out which building societies are joining this scheme? Are the credit union and An Post safe?

- Ms E K, CORK

A

The Eligible Liabilities Guarantee provides cover for some - but not all - savings.

In terms of deposits, only sums in excess of €100,000 are covered - and only as long as they are with groups registered with the National Treasury Management Agency (Nama) under the scheme. These include AIB, Bank of Ireland, Irish Life & Permanent, Anglo Irish Bank, EBS Building Society, Irish Nationwide and ICS Building Society.

Deposits below €100,000 are already fully covered under the separate Deposit Protection Scheme, which also covers credit union savings up to the same threshold.

An Post savings are fully protected under yet another State guarantee.

This column is a reader service and is not intended to replace professional advice. Due to the volume of mail, there may be a delay in answering questions. All suitable queries will be answered through the column. No personal correspondence will be entered into.

Please send your queries to Dominic Coyle, Q&A,The Irish Times,24-28 Tara Street, Dublin 2. E-mail: dcoyle@irishtimes.com