For nearly three decades, a large group of mostly elderly and vulnerable mortgage holders have endured the consequences of a financial product that promised security but delivered profound hardship. The Shared Appreciation Mortgage (SAM), sold in the late 1990s primarily by Bank of Scotland (now part of Lloyds Banking Group) and Barclays Bank, was aggressively marketed in national newspapers as a safe and sensible form of equity release. But for many, it has become a lifelong financial burden.
The SAM offered borrowers a lump sum payment in exchange for a substantial share of up to 75% of the future increase in the value of their homes in addition to repayment of the original loan. While the right to remain in their homes until death was preserved, what was not protected was the borrowers' financial and future stability. As house prices soared, the cost of this pernicious product to the borrowers became catastrophic with consumers owing the banks in some cases 500 per cent of the amount originally borrowed.
These mortgages have marred retirement plans, erased family inheritances, and left elderly and vulnerable individuals with insufficient equity to move home or pay for care, trapping them in properties that are simply not suitable for their needs.
Both Bank of Scotland and Barclays Bank speak often about their ethical commitments to the vulnerable consumer.
Lloyds Banking Group, the parent company of Bank of Scotland, declares:
Barclays similarly asserts:
And yet, these statements stand in stark contrast to the banks' ongoing treatment of the thousands of SAM borrowers. What we are witnessing is not just a legal dispute, but a moral dissonance — a disconnect between the banks' stated values and their sustained, adversarial approach to these long-standing grievances.
What these vulnerable consumers and their families need is not a courtroom battle, rather compassion and a fair resolution that aligns with the banks' publicly promoted principles.
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