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.

What is the Scheme?

The Scheme aims to help customers who are in a situation of substantial hardship, and as a result need either to move to a more suitable property or adapt their existing home to make it suitable to their needs, but are unable to do so due to their SAM.

Although there is no strict definition of 'substantial hardship' and each case is considered individually, eligible customers predominantly fall into the following broad groups:

• Customers who need to move to a more suitable property owing to disability/illness/mobility/change of circumstances (the SAM is not portable)
• Customers who wish to remain in their current property, but who need to adapt it to their needs (caused by disability/illness/mobility difficulties)