A GROUP of homeowners who do not want their bank to alter their mortgages from interest-only repayments have taken their case to the High Court.
More than 70 separate cases have been brought against Irish Life and Permanent TSB after the bank announced last year it was going to require them to make interest and capital repayments on the mortgages.
Mr Justice Roderick Murphy yesterday gave permission for four test cases to be brought.
All the plaintiffs took out the interest-only mortgages between the end of 2004 and 2007 at agreed interest rates. They agreed to pay interest for the full term of the mortgage and to pay off the capital at the end of the term or when the property was sold.
The court heard yesterday some of those who had taken proceedings were in financial difficulties, and some had taken out the mortgages with a view to purchasing property as a pension.
Mr Justice Murphy ruled two cases relating to homeowners who got a mortgage directly from the bank and through independent brokers will proceed. He said two more cases can be chosen to act as “pathfinder” cases. The four cases would be sufficient for a representative decision, he said.
Ross Maguire SC, for the homeowners, is to ask the High Court to decide on a preliminary issue relating to a provision of the Consumer Credit Act where the terms of a loan have to be set out on the front schedule of the housing loan documents. Mr Maguire said the issue to be decided is whether the bank is bound by the terms set out in the schedule.
Paul Gallagher SC, for the bank, said it had thought only two cases were to come before the courts, but “others appeared out of the woodwork”. He asked the court to direct two test cases, and said this would avoid both sides incurring large costs.