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Money Saving Expert estimates that there are over 140,000 mortgage prisoners in total:

  • 120,000 with unregulated/unauthorised lenders: Firms who are not regulated by the FCA which makes it harder for the regulator to help people who have mortgages with them.
  • 20,000 with inactive lenders: Firms that are able to offer mortgages, but no longer do, such as Tesco and Sainsbury’s who have stopped lending.  This means that customers who have mortgages with them and can’t pass affordability checks with different lenders can’t move to a better deal.

Most of these customers who are stuck on their lender’s standard variable rate (SVR) mortgage, with an interest rate often higher than 5%.

DTMM - Social Media post - Mortgage Prisoners

What is a mortgage prisoner?

Mortgage prisoners are people who want to remortgage but find themselves trapped in their current mortgage deal.

Generally, they are borrowers that can’t afford to remortgage as they do not meet strict borrowing criteria.  This is regardless of whether they are keeping up with payments. They are also normally people who are paying a higher rate on their mortgage and want to switch to a cheaper rate.

  • You are classed as a mortgage prisoner if you’re unable to remortgage, normally due to equity or affordability problems
  • The 2014 Mortgage Market Review (MMR) changed the way that lenders assess affordability for borrowers.  This has been criticised for being too strict, which in turn is stopping people from remortgaging to cheaper deals.

The term ‘mortgage prisoner’ is used in reference to anyone who has become trapped on their current mortgage deal, unable to move house or remortgage.

Historically, falling house prices reduced the equity of homeowners meaning they struggled to get a better deal. In recent years, the Mortgage Market Review’s change to affordability criteria has prevented some existing homeowners from remortgaging.

What can you do if you are a mortgage prisoner?

If you think you may be a mortgage prisoner, the team at Dan The Mortgage Man are happy to talk through your options.  With access to a wide range of mortgage lenders and over 10,000 different mortgages, our mortgage experts can tell you what your options are.

Contact Dan The Mortgage Man

Wirral Office: 0151 601 4234
Essex Office: 01245 806 555
Mobile: 07837 820 894

or contact us online by clicking here.

Find out more about Dan the Mortgage Man

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