26 May 2023
What is a Mortgage Prisoner?
‘Mortgage prisoners’ are people who are unable to switch mortgages to a better deal, despite being up-to-date with their mortgage payments.
Where does the name come from?
As the name suggests it is a situation where homeowners are ‘trapped’ in their existing mortgage, unable to switch to a deal with better terms, or rates. The term ‘mortgage prisoner’ surfaced during the financial crisis of 2008.
How does someone become a mortgage prisoner?
Mortgage prisoners often arise due to a combination of factors such as changes in economic downturns, lending practices, and regulatory constraints.
Below are a couple of scenarios which could lead to a borrower becoming a mortgage prisoner:
- High Loan-to-Value (LTV) Ratio: if you have taken out a mortgage with high LTV ratios, which means you borrowed a large portion of the property’s value (read more about LTV here). If the value of the property declines, or if your financial situation deteriorates, you may find yourself in a position where you owe more on your mortgage that the property is actually worth. This can make it difficult to refinance or switch lenders.
- Tightened Lending Criteria: following the financial crisis, lenders have implemented stricter lending criteria, making it more difficult for borrowers to secure new mortgages. This means, some existing homeowners who were previously able to get a mortgage do not meet the new criteria when trying to switch to a new lender or negotiate terms.
Unfortunately, mortgage prisoners may be stuck with higher interest rates and unable to benefit from any lower interest rates on the market. There are regulations and policies in place which provide initiatives to provide relief and potential solutions for those affected and facing financial hardship.
The team at Mortgage Required will be happy to talk further about Mortgage Prisoners with you. Give us a call on 01628 507477 or email team@mortgagerequired.com
Recent posts
Additional borrowing, also known as a further advance, is when you borrow more money on your existing mortgage for a specific reason agreed with your lender.
Here are five of the most common reasons for additional borrowing.
UK Housing Market Round-Up: 2025
17 days ago
Property search site Zoopla has estimated that the UK housing market will end 2025 with approximately 1.15 million completed sales – 4.5% more than the previous year.
Take a look at the 2025 summary of the UK housing market.
Best UK Mortgage Rates this Week
17 days ago
Here are the lowest fixed mortgage rates of the week, available to first-time buyers, home movers, buy-to-let, and those remortgaging.
Call us for more information: 01628 507477 or email: team@mortgagerequired.com.
Buying in the New Year
18 days ago
If buying your first property, or moving home, is on your to-do list this year, the new year can be a great time to take this big step. In this short blog, we look at what you need to consider as you plan and prepare for your home-buying journey.
Just because the Bank of England decides to reduce the base rate, this doesn't automatically mean that your mortgage rate will go down.
Autumn Budget 2025: A Summary
26 Nov 2025
Chancellor, Rachel Reeves, has delivered the Autumn 2025 budget. We have summarised the government's plans for tax and spending.
Renters' Rights Act
14 Nov 2025
The Renter’s Rights Bill became law at the end of October, which means it has been signed off by the King, and it is now the Renters’ Rights Act. Despite this becoming law, these changes are likely to start changing within the next six months, with the aim of being fully implemented throughout 2026 and into 2027.
A welcome change in school is coming as financial literacy is due to become compulsory in schools in England.
The Government has announced that as part of the new national curriculum, children in primary and secondary education will be required to learn about budgeting, compound interest, managing money, and mortgages.
More information
Trusted by
