When Northern Rock collapsed in 2008 no one could imagine that nearly 15 years later thousands of people would still be suffering with the consequences. Yet that’s exactly what has happened to the 27,000 so called ‘mortgage prisoners’ who have been trapped with excessively high interest rates ever since.
These borrowers were singled out for “unfair” rates after their loans were sold to TSB Bank, to be administered under its Whistletree trading name following Northern Rock’s collapse. Homeowners were charged a standard variable rate almost twice that of TSB’s own and prevented from switching to the lower rates that were available to other customers.
Now a group of lawyers from Harcus Parker are helping the victims to fight back.
They have issued court proceedings and launched what could become an £800m legal case against TSB Bank in a bid to try and get millions of pounds in overpaid interest back in the hands of the people trapped by the unethical banking practice.
Anyone who took out a mortgage with Northern Rock, which was or is currently serviced by Whistletree could be entitled to join the legal action by registering at www.whistletreeclaims.com
On Monday, six years to the day since TSB bought £3.3bn mortgages from Northern Rock, approximately 200 homeowners whose mortgages have been administered by TSB’s ‘Whistletree’ brand issued claims for around £50,000 each in overpaid interest.
Matthew Patching, senior associate at Harcus Parker, said: “Our clients have been treated terribly by TSB: they have been charged interest on their mortgages at rates significantly higher than those charged to other similar customers at the same bank.
“This has had a real and devastating impact of the lives of homeowners who, other than happening to take out a mortgage with Northern Rock prior to the global financial crisis, are often identical to large numbers of TSB’s other customers.
“The Together Mortgage was a particularly toxic product. It appeared to allow borrowers to take out an unsecured loan, alongside a mortgage, at a reasonable rate of interest, but there was a catch: if the mortgage was ever paid off, or if the borrower switched to another lender, interest charged on the linked loan of up to £30,000 would jump by up to eight per cent.
“It is hardly surprising that - from what we can tell - the Whistletree portfolio of mortgages has comfortably produced more profit for the bank than its ‘ordinary’ mortgages.
“Many of our clients have never been in arrears or fallen behind with payments, but were told for a significant period of time by a reputable high street bank that they could not access TSB’s mortgage rates, and instead must pay a very high ‘Whistletree Standard Variable Rate’.
“This breached the express and implied terms of the mortgage contracts, and TSB’s regulatory obligation to ‘treat its customers fairly’.
“We want to ensure that as many people as possible are included in the fight for justice.”
Harcus Parker will act on a no-win, no-fee basis, and will pay any third-party costs necessary to progress the claims to trial.
Visit www.whistletreeclaims.com to join the claim.
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