What are Shared Appreciation Mortgages?
In return for nil repayments on their loan, customers agreed to repay on sale of their property the original sum borrowed, plus a percentage of the house price increase (equity) up to a maximum of 75%. If house prices had fallen customers would have paid back only the original sum borrowed. The loan could not be transferred to another property so some SAM customers, whose homes have dramatically risen in price since 1998, now find themselves in situations of substantial hardship, which is often exacerbated by the terms of the product. Barclays is unable to vary the terms of the SAM as the product was sold to third-party investors in 1999. As such, in June 2007 we set up the Barclays Shared Appreciation Mortgage (SAM) Hardship Scheme (the Scheme), to help these customers.
