There has still been no response from the government one year after the publication of the LSE Report with proposals to help mortgage prisoners.
In a letter to the economic secretary, Seema Malhotra, co-chair of the All-Party Parliamentary Group on Mortgage Prisoners, questioned when the government would respond to the LSE's mortgage prisoner report.
The letter, seen by FT Adviser, outlined that on March 1, 2023 the APPG hosted consumer champion Martin Lewis as he launched the report written by LSE called 'Releasing the Mortgage Prisoners'.
The report made a series of recommendations to help 195,000 closed-book borrowers unable to transfer onto mainstream mortgage market products.
It was the third report produced by LSE on the subject, but was the first to lay bare the potential cost of helping these consumers.
In April 2023, the APPG held a meeting with Baroness Penn and Treasury officials to discuss the report and its key recommendations.
These included free comprehensive financial advice for all prisoners, interest-free equity loans, and government equity loans on the model of Help-to-Buy which would be interest free for the first five years.
Additionally in the April meeting, the minister heard from representatives from UK Mortgage Prisoners about the harm their situation was causing them.
They explained how the issue was getting worse for them every month as interest rates increased.
Malhotra said: “Mortgage Prisoners are suffering every month due to high standard variable rates as the government sold their mortgage on to vulture funds with no protection.”
The economic secretary at the time promised to read and seek official advice on the proposals put forward in the LSE report.
However, despite this promise, the co-chairs accused the government of still not responding to the LSE report and not taking any additional action to help mortgage prisoners.
The letter stated the APPG would like to meet with the economic secretary to hear the government’s response.
Malhotra added: “We need an urgent response from the government to the proposals in the LSE report and further action to help mortgage prisoners including a requirement for mortgage prisoners to be offered fixed rates.”
tom.dunstan@ft.com
What's your view?
Have your say in the comments section below or email us: ftadviser.newsdesk@ft.com
