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BBC News
By Andy Verity
image captionVanessa Bampton is one of thousands of mortgage prisoners
MPs are challenging the government to live up to a promise to help homeowners trapped paying high interest rates because the Treasury sold their mortgages to unregulated firms.
Since they cannot switch to a better deal, an estimated 250,000 homeowners are forced to pay standard variable interest rates.
These are well above what a competitive mortgage would charge.
But moves to ease their plight are being blocked, MPs say.
The House of Lords has passed an amendment to the Financial Services Act to cap rates for borrowers in that position, known as mortgage prisoners .
16
th April 2021 8:00 am
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th April 2021 4:40 pm
The House of Lords has voted in favour of an amendment to the Financial Services Bill to impose a cap on standard variable rates charged to mortgage prisoners.
According to the wording of the clause, the cap would apply to borrowers who are unable to switch lender and whose mortgage is owned by an inactive or unregulated business.
Lords voted 273 to 235 in favour of keeping the amendment yesterday, however the Bill now returns to the House of Commons and the UK Mortgage Prisoners action group is urging MPs to support the proposal.
It says: “We would like to thank Lord Sharkey, co-chair of the All-Party Parliamentary Group for Mortgage Prisoners, for the inclusion in yesterday’s debate of the amendments for mortgage prisoners in the Financial Services Bill.