Cooper’s parents passed away in 2024, and their home was valued at $750,000 last year. As a result, Cooper and his sister will likely have to surrender most of that equity to the bank. Cooper believes his parents never imagined that the $42,500 loan could balloon to nearly $500,000, effectively “costing their kids their inheritance.”
The bank counters that it advised borrowers at the time to seek independent financial advice to ensure they understood the product, noting that solicitors were engaged by the borrowers in this case.
The Coopers are among hundreds—perhaps thousands—of families whose lives have been upended by shared‑appreciation mortgages (SAMS). These loans were offered only briefly, between 1996 and 1998, and were available from just two banks: Bank of Scotland and Barclays.
Designed for “asset‑rich, cash‑poor” seniors, the mortgages let borrowers tap up to 25 % of their home’s value, often with no repayments required during the loan term. Repayment was due when the mortgage was settled, when the borrower died, or when the house was sold, plus a share of any increase in the property’s value.
That share was typically calculated on a three‑to‑one basis—borrowing 25 % of the value meant surrendering 75 % of any future appreciation. Since the loans were sold, house prices have surged, leaving borrowers facing enormous repayment bills if they move, and leaving heirs like Cooper with a costly, complex legacy.
