Brian Neville took out a mortgage for £20,000 in 1997, on a small bungalow in Poole, Dorset. Now, aged 87, he feels he cannot sell the property, believing if he did, he may owe his bank ten times this amount. Under the terms of Brian’s mortgage, if he sold his home, he would likely owe his lender, Bank of Scotland, around £200,000 – or ten times his initial mortgage size – from the sale.
Under this type of loan, the borrower releases equity in their home – in this case £20,000 – and gets a lower interest rate on the repayments. In return though, they owe the bank they borrowed from a share of the increase in their home’s value. Brian bought the property for around £84,000 in 1997, after financial issues left him having to downsiz
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