Mortgage Prisoners are homeowners who pay high interest rates on their mortgages without the opportunity to switch to a cheaper and more-competitive mortgage with a different lender. They are effectively trapped by their mortgages and have no choice but to pay the interest rates set by their lender.
People can be Mortgage Prisoners in different ways. For example, portfolios of former Northern Rock and Bradford & Bingley mortgages are held by inactive lenders, that is to say, lenders which do not offer their existing customers new mortgage deals and do not seek to take on new customers. Another type of Mortgage Prisoner are those whose mortgages were transferred to a high street bank, such as TSB, which services a portfolio of former Northern Rock mortgages through its Whistletree brand. TSB treats its customers who have what it calls ‘Whistletree’ mortgages differently from its other customers, and charges them higher rates of interest. TSB offers new mortgages through Whistletree but, historically, these have been more expensive than equivalent TSB mortgages.
The claim we will bring will allege that your lender has treated you unfairly and that your lender’s actions have been in breach of the terms, or the implied terms, of your mortgage contract. In addition, some claimants may be eligible to bring other claims such as claims under the Consumer Credit Act that the mortgage agreement constituted an unfair lending relationship.
If we act for you, we will say that, although the rate at which your lender lends money is discretionary, that discretion must not be exercised in a way which is unfair. This assertion is supported by a number of parts of the Financial Conduct Authority’s ‘MCOB’ rules, which require customers to be treated fairly.
The potential defendants we have identified at this stage are:
- Bradford & Bingley Plc;
- Landmark Mortgages Limited;
- Mortgage Agency Services Number Five;
- NRAM Limited;
- Pepper (UK) Limited (trading as Engage Credit);
- The Mortgage Business Plc;
- Topaz Finance Limited (trading as Heliodor Mortgages and Rosolite Mortgages);
- TSB Bank Plc (trading as Whistletree); and
- UCB Home Loans Corporation Limited.
We have not finalised the list of defendants to the litigation. The final list will depend on the merits of the claims against a particular lender and the number of borrowers who are seeking to bring claims with us against that lenders. As a general rule, the more people who sign up with us with a particular lender, the more likely it is that we will be able to bring claims against that lender.
Under the terms of the Litigation Management Agreement, which we ask you to agree to as part of the sign up process (we will also provide you with a copy to review), you authorise a committee of claimants, who are homeowners and are (or were) Mortgage Prisoners like yourself, to give us instructions in relation to your claim. We ask you to delegate your authority in this way because we consider that is the only way we can effectively manage and progress the thousands of claims belonging to the borrowers who have instructed us. It would be both impractical and costly for us to take individual instructions from each of you, and it is not reflective of how claims such as this are normally brought before the Courts.
Please let us know if you are interested in becoming a member of the committee by emailing MP@harcusparker.co.uk
You can apply to join the claim by clicking ‘join the claim’ above. You will need to complete a short registration questionnaire and agree to instruct Harcus Parker to act as your solicitors. We will then begin to investigate your claim including requesting from your lender that they provide us with all relevant documents relating to your mortgage.
If you are eligible to bring a claim and you choose not to join, we would not be able to bring your claim. If the claims we do bring are then successful and our clients receive compensation, you would not become automatically entitled to compensation alongside our clients.
The limitation rules for bringing claims specify a time limit within which a claim must be brought. If your claim is over that time limit, then you will not be able to bring the claim and you would have lost the chance to receive compensation alongside our other clients if the litigation is successful.
Although you may have had your mortgage for a much longer period, you are only eligible to bring a claim with us if you did not redeem your mortgage (or, alternatively, any unsecured loan linked to your mortgage if your mortgage was a Northern Rock ‘Together’ product) more than six years ago. We are imposing this cut off because the limitation rules may mean that we would not be able to make a claim to recover overcharged interest paid by you more than six years ago. This six-year time limit is constantly running, and we can only stop it if you register and we then issue your claim.
To minimise the risk of your claim being out of time and finding that you cannot bring your claim, or that the value of your claim is reduced, it is advisable to join sooner rather than later.
It is very important that you read our full terms and conditions and other documents provided when you sign up. If you have any questions about any of the documents you can email us at MP@harcusparker.co.uk and the team will get back to you.
At this stage it is very difficult to say. The amount of any compensation you may be awarded is a matter for the Court. However, the amount we will claim on your behalf will depend on factors, which may include: i) the size of your mortgage; ii) the term of your mortgage; iii) the interest rate you are and have been charged on your mortgage; iv) the terms and conditions of your mortgage; and v) how your particular lender has treated its customers.
Yes. If you paid off your mortgage, and this was in the last six years, you can join.
Alternatively, if you have a Northern Rock ‘Together’ mortgage product (which is a mortgage linked to an unsecured personal loan) and you have not yet paid off the unsecured personal loan, or you paid it off less than six years ago, you can join
Yes. You should not stop paying your mortgage as a result of joining the claim. It is vital that, by joining the claim, you do not think you will solve any debt issues you might have. There is no guarantee that the claim will be successful. You must continue to manage your debt diligently and carefully, taking advice where possible. Organisations such as StepChange and Citizens Advice may be able to offer you some guidance about how best to manage your money.