LLoyds Bank facing £60million lawsuit over ‘rip-off’ mortgages – as ‘160 elderly borrowers trapped in their homes’
LLOYDS Bank faces a £60million lawsuit over “rip-off” mortgages.
Lawyers claim 160 elderly people are trapped in their homes owing huge amounts.
A High Court judge is due to hear the class action lawsuit in January that could result in the huge compensation payout.
The case relates to shared appreciation mortgages sold by the Bank of Scotland — now part of the Lloyds Banking Group — between 1997 and 1998.
Customers could use the low interest or interest-free loans to release up to 25 per cent of the value of their property.
They had to repay the loan in full along with a 75 per cent share of their home’s future increase in value.
With house prices rocketing, many face crippling repayments.
One homeowner who released £30,000 in equity now has to pay back £251,250 after the value of their property shot up from £120,000 to £415,000.
London law firm Teacher Stern argues the loan terms were “grossly excessive” and have “trapped borrowers”.
The Bank of Scotland said: “We recommended borrowers took financial advice to ensure they understood the product, that it was suitable for their needs and all were advised by their own solicitor.
Should any customer face financial hardship, we will do everything we reasonably can to help.”