‘We had a Northern Rock mortgage

“Legally, we can’t live here permanently,” says 67-year-old John Allen. “It’s just a temporary solution, and we’ll need to find somewhere else to stay between January and March after Christmas.”

In September, John, a former advertising executive, and his wife, Val, 69, were forced to sell and leave their family home in Manchester. They are one of thousands of mortgage prisoners struggling with above average interests rates post the financial crisis.

Today, they’re living in a static caravan in a holiday park in mid-Cheshire. It’s a 40-minute walk from the nearest shop or train station. The alternative was homelessness.

John knows this all too well because the couple’s car has been broken down for two weeks, leaving him and Val stranded.

Val is even more stranded than John. She relies on the use of a wheelchair and walking sticks to get around after a serious stroke, blood clot and deep vein thrombosis (DVT) caused her to need a leg amputation.

‘I can’t think about it’

Mobility is made more difficult still by the fact that getting into the static caravan that the Allen’s now call home requires ascending a set of metal steps.

“I don’t allow myself to think too deeply about the situation I’m in because I find it fairly unbearable,” Val says. “We’ve lost everything and [our mortgage company] have been absolutely vile.”

The Allens have lost almost everything – the home they brought their daughter up in, their furniture, a shedload of money, and even two of their dogs as they couldn’t bring them here to live with them.

How did they end up here? Sort of living in a chilly static caravan bought for them for just over £10,000 by their 29-year-old daughter to prevent them from being homeless?

On 10 August 2007, just one month before the global financial crisis, the couple took out a £247,000 interest-only mortgage with Northern Rock. Northern Rock then ran into serious financial difficulty and was nationalised in 2008.

Ownership of their mortgage was transferred by the UK Government as part of the Northern Rock Asset Management (NRAM) loan book sell-off to a private company.

The Allens became mortgage prisoners. Like thousands of other mortgage customers who took out loans with Northern Rock – or other lenders which floundered after 2008 – they have been trapped in ‘closed book’ mortgages with higher than average interest rates.

The Allens’ decision to borrow from Northern Rock kick-started nearly 20 years of misery and stress. Mortgage prisoners, like John and Val, have been stuck paying high variable rates, often damaging their finances so badly that they cannot remortgage or move to a new lender. Through a complex chain of financial deals, their loans have often been repackaged and sold on to companies that won’t offer cheaper rates.

‘That’s when the difficulties began’

The Financial Conduct Authority (FCA) estimated that there are 47,000 mortgage prisoners in Britain. However, other groups, such as the campaign group UK Mortgage Prisoners, say the total is closer to 200,000, and their treatment at the hands of the private companies that own their mortgages is an ongoing scandal.

“It was all OK to start with when we were transferred to NRAM,” John recalls. “But then our mortgage was sold to Topaz Finance, who managed it via a company called Heliodore. That’s when the difficulties began.”

Heldiore took over the Allens’ mortgage following the government’s completion of the NRAM sale in 2019. Heliodore is the trading name of the UK-based mortgage administrator, Topaz Finance. Topaz are ultimately owned by Computershare Limited, a global finance company which is ultimately based in Australia. Heliodore is known as a ‘closed book’ lender because it does not offer new mortgages.

John was made redundant in 2017. Until then, he and Val had managed to keep on top of their interest-only repayments and hadn’t worried too much about the mortgage, but then they started to fall behind.

“We had never been in arrears on our mortgage before,” he explains. “But then it became almost impossible to move to another lender because we were viewed as subprime.”

When the pandemic arrived, inflation and rising interest rates came with it. The freelance work that had kept John’s finances ticking over dried up overnight.

“We had to take a payment holiday during Covid, and then the arrears just went up and up as interest rates went up too,” John says. “In February 2023, we were £5,385 in arrears. In August 2023, it was £11,837 and then by February 2025, when Heliodore wanted to repossess us, it was £44,351.

“It just kept going up and up, and it felt like it would never end.”

During this period, interest rates spiked. Val then became seriously unwell and John had to stop working entirely to care for her.

“We really noticed a difference with our mounting bills from Heliodore after the Liz Truss mini-budget,” John says, “and then with Val’s health problems, it just got worse and worse. I was in hospital, I didn’t have time to keep ringing Heliodore and waiting on hold to try and talk to someone.”

Not only did the Allens have £44,000 worth of arrears, because their mortgage was interest only, they owed £247,000 on their home, bringing their total debt to Heliodore to almost £300,000.

Being subjected to higher mortgage rates by their ‘closed book’ lenders than other borrowers is a major reason why mortgage prisoners end up being pushed into arrears.

In 2024, the Allens’ interest rate went above 8 per cent. Throughout 2025, the Allens told The i Paper that it was consistently above 7 per cent, reaching almost 8 per cent in April.

However, the average fixed rate for a new mortgage has been much closer to, and in some cases even below, 5 per cent. This means that the Allens, like so many mortgage prisoners, have been paying thousands of pounds more in interest than mortgage customers who can access competitive rates in the mainstream mortgage market via high street lenders.

‘Truly appalling’

Liberal Democrat peer Lord Sharkey has worked to raise the plight of mortgage prisoners in Parliament. He described the Allens’ story as “truly appalling”.

“Unfortunately, this isn’t rare among mortgage prisoners,” he added. “I know of similar cases, cases of repossession and even of suicide. Lots of lives ruined.”

Lord Sharkey is currently sponsoring a private members’ bill which aims to establish an inquiry into how the UK government allowed former Northern Rock loans to be sold to private companies that were able to charge such high interest rates.

“It is completely unacceptable that the thousands of mortgage prisoners continue to pay well over the odds for their mortgages. And it’s no wonder that this leads to ruined lives,” he said.

“Did I ever envisage living like this? Not in a million years,” Val says over tea in the caravan. “It’s very hard to process, to live with… I’m just taking a view that I am glad to be alive at the moment.”

John has had some incredibly dark moments. “I know people in the wider mortgage prisoners group struggle with suicidal thoughts,” he reflects tearfully. “I have felt awful, but I just can’t let myself go there because I’m Val’s primary carer.”

“In some ways, I’m better now, because I don’t have the enormous and mounting debt sitting on my head, and we are out of the mortgage trap we got put in,” he adds. “We’ve lost our house and been forced to split up our dogs, but mentally I am better than I was because this caravan provided an escape route.”

Despite knowing about the Allens’ difficulties, Heliodore issued a repossession order in April 2025. With the help of Mortgage Prisoners UK, they were able to postpone the hearing and sell their home to pay off their debts, but it has left them with nothing.

A spokesperson for Computershare told The i Paper: “Mr and Mrs Allen have experienced an extremely challenging time as a result of Covid, the cost-of-living crisis and their health concerns. We’ve approached their situation with the utmost sympathy at all times. Our specialist vulnerability forum, which takes into consideration difficult personal circumstances, has been involved throughout.”

“We’re hoping that the council will be able to get us a social housing flat at some point, but there’s a long waiting list,” John says. “We need an adapted property for Val with grab rails and a wheelchair ramp, and, sadly, local councils are under pressure and these just aren’t really available. We don’t know how long we’ll be waiting.”

After Christmas, as things stand, John and Val will be living with their daughter in the living room of her London flat during the weeks in which they must vacate the caravan to satisfy the legal requirement that it is not a permanent residence.

Lord Sharkey called on the Government “to acknowledge that mortgage prisoners are themselves not at fault and are the victims of an unnecessarily harsh regime, and they need to find a way out.”

“This is shameful and cruel, and I urge the Government to respond in a meaningful way,” he added.

Heliodore added: “We’ve had regular contact with Mr and Mrs Allen’s representatives since April 2025 and have therefore been able to work with the couple’s chosen estate agents and help ensure the house was sold and legal action was avoided.

“We suspended all mortgage payments and contributed around £10,000 towards estate agent fees, selling costs and waived interest payments.”

The Treasury was approached for comment.

If you need support, please contact the Samaritans on 116 123 or email jo@samarritans.org.

Are you a mortgage prisoner? Please contact vicky.spratt@theipaper.com