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One pensioner is at risk of losing around \u00a3100,000 due to a \u201cdevastating\u201d deal with her bank, according to her son.<\/p>\n
Steven Hutchinson, 62, from Kimberley in Nottinghamshire is speaking out about the impact of shared appreciation mortgages (SAM) on his 88-year-old mother, Beryl.<\/p>\n
SAMs are mortgage deals which involve the bank or lender agreeing to receive some or all of the repayment in the form of a share of the increase in value (the appreciation) of the property.<\/p>\n
Due to this arrangement, Steven\u2019s mother must either stay at her home in Eastwood or give Barclays over \u00a3100,000 from the sale.<\/p>\n
His father, Barry, asked his son to examine the couple\u2019s finances which led to Steven making the discovery.<\/p>\n
Read more… Barclays, Halifax and NatWest slash mortgage rates again this week<\/strong><\/p>\n The 62-year-old found out that the mortgage taken out in the 1990s, worth \u00a316,250, was harmful to his parents financially.<\/p>\n Barclay loaned the couple money which Barry spent on making home improvements and his car.<\/p>\n Under the terms of the shared appreciation mortgage, he would have to pay it back in full along with a share of the home\u2019s increase in value after it was eventually sold.<\/p>\n According to Steven, 75 percent of the property\u2019s appreciation would be entitled to the bank which would negate any of the value and work his parents had placed into the home over the years.<\/p>\n As a result of this, he hid the truth of the mortgage from his father until his death in November 2022 so as not to worry him.<\/p>\n Don’t miss… <\/strong> Specifically, Steven was concerned the sale of the property would fail to generate enough income to pay for a care home for his mother in case she fell into poor health.<\/p>\n Speaking to Nottinghamshire Post, he explained: \u201cIt had to be mis-sold because no one in their right mind would have agreed to that. They’d already paid the mortgage and thousands of pounds of interest, the house is theirs.<\/p>\n \u201cWe [Steven and Beryl] had to sit down and have a horrible conversation about how the bank is going to take what you worked all your life for – at a time when we were grieving for him.<\/p>\n “Everything they do is to maximise the money they can get out of it. My mum wanted to leave the house to her children, like my father did. She could not believe that a trusted institution like a bank would do this before, but she’s had her eyes opened now.”<\/p>\nMartin Lewis speaks on loans and mortgages<\/h3>\n
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