From This is Money:
The loans were a form of equity release called shared appreciation mortgages (Sams), sold by BoS in the late Nineties.
Half the borrowers have since died or redeemed their loans, leaving approximately 7,000 in force.
Most deals mean the banks keep 75% of any increase in the property’s value, resulting in the original sum borrowed more than tripling in ten years, leaving borrowers trapped in their properties and in some cases facing hardship as a result.
As the controversy has grown there have been repeated calls from MPs, lobby groups and Financial Mail for BoS to take a more lenient line, or at least allow the loan contracts to be tested in court.
BoS has been reluctant, but a case is being mounted and last month achieved a significant victory.
The Chief Chancery Master, a judge who decides on court procedure ahead of a trial, indicated he would allow hundreds of Sams borrowers’ cases to be grouped together in a process known as a ‘group litigation order’.
This was a cruc…
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