Mortgage prisoner granted respite after 14 years of distress

These were:

• We will accept lower payments from you of £700 each month for 6 months. 
• This is in addition to the "Support for Mortgage Interest" which is paid directly to us by the DWP. We currently receive £219 every 4 weeks. 
• We will 'top up' the rest of your monthly payment, which means you will be shown as making the full payments due. 
• This will also ensure that you are not reported as falling into arrears. 
• This arrangement will start from 28/05/2023 and will end on 28/10/2023. 
• Before 15/11/2023, we will review your circumstances again and agree next steps. 

But the letter also stated: "Please be aware that this arrangement is to help you to take steps in preparing to sell the property and move into a rented property."

The true cost

Since the mortgage of £225,000 was first taken out with GMAC, the Ls have paid back, including arrears:

But there is still the following amount outstanding:

By the time everything is paid off, the couple will have paid nearly double the amount of the initial mortgage they took out.

But even this is not the "true cost" according to Mrs L.

Mrs L said: "Being a mortgage prisoner isn't just about the additional money we pay in interest, it is about the impact of missing out on elements of family life for extended periods of time and the significant effect that this has upon mental health."

According to Mrs L, they had no Christmas presents last year. In February she said: "We only ate this month thanks to financial help from the UK Mortgage Prisoner Group."

By March they were using a foodbank. "There have been significant suicidal thoughts for both of us due to mortgage rate increases. We've applied for social housing but have very little equity in the house.

"We are also facing additional £5,000 cost to repay a £363.45 council grant. We also have £15,000 Support for Mortgage Interest to repay. We would not have needed SMI if on our contractual rate."

FTAdviser asked the Co-Operative Bank whether the couple would have needed SMI if they had been on their original rate. A series of other considerations that existed at the time their original fixed rate term came to an end meant they had not been able to pursue a mortgage with another lender.

A bank spokesperson said: "Mr and Mrs L’s mortgage was subject to an initial fixed rate of 5.79% for a period of 2 years.

"After this, it reverted to the Standard Variable Rate (SVR), in line with the terms and conditions of the mortgage and in accordance with the typical operation of a fixed rate mortgage.

"We believe that Mr and Mrs L would have still required access to SMI, even if their fixed rate had not reverted to the SVR, based on wider consideration of their circumstances.”

Mrs L added: "We suspect that your article must have had a massive bearing on this outcome. We're going to let it sink in and then crack on. A few months' respite after the last 14 years is incredible."

It is understood appointments had been booked with The Co-Operative Bank advisers before FTAdviser got involved.