Mortgage prisoners who have their mortgages with Landmark have been informed these will be sold on to Bloom Homeloans at the end of the week.
In a letter sent to customers, seen by FT Adviser, Landmark Mortgages informed mortgage prisoners that it has agreed to transfer a portfolio of loans to Bloom Homeloans, a trading name of Topaz.
The letter informed prisoners that, in future, Bloom will be responsible for setting the interest rate and any fees applicable to the customers’ loans.
Bloom will also collect monthly payments, send annual statements, and respond to general inquiries.
“We expect the transfer to take place over the weekend of February 15 and 16 February. Bloom will write to you to tell you once the transfer from Landmark Mortgages to Bloom is complete,” it added.
The announcement received criticism from members of the UK Mortgage Prisoners group who demonstrated frustration with the prospect of having their mortgages sold to yet another lender.
One member of the group described it as a “devastating setback for our members”.
Credit ratings firm Fitch Ratings said the transfer includes a “small proportion” of the nearly £11.8mn in unsecured loans.
It explained that around 89.6 per cent of the mortgage borrowers in the pool have paid a relatively high SVR over the past decade, despite low interest rates in this period.
“Some borrowers in the UK, most likely including some in this pool, have joined a pressure group (UK Mortgage Prisoners) to achieve a lower interest rate, a change of lender/product offering or compensation”, it added.
“Fitch understands that to date, they have been largely unsuccessful in court actions but continue to lobby for government action or legal redress.
“Fitch notes that widespread remedial actions, set-offs, or further relevant legislative or regulatory changes are difficult to quantify at this stage, and each could lead to negative rating action.”
Bloom Homeloans’ website is set to go live on February 17.
tom.dunstan@ft.com
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