Northern Rock collapsed in 2008 Together mortgages were offered by Northern Rock from 1999 to customers who wished to take an unsecured loan of up to £30,000 alongside their mortgage, and repay the “top-up” loan at the same rate. More than 150,000 smaller borrowers were told in 2012 they were in line for £270m worth of compensation for blunders in the loan paperwork, even if they had not suffered losses as a result. However, those with top-up loans above £25,000 were excluded from the scheme. NRAM forms part of UK Asset Resolution, the taxpayer-owned body that controls the state-owned financial assets including shares in RBS and Lloyds. Any compensation would have been paid out of the public purse. Last year, NRAM brought a test case against an employee who held such a mortgage, to try and establish that it had no obligation to pay compensation to those with loans of more than £25,000. The High Court disagreed, and ruled in December that 41,000 borrowers should be paid an average of £6,300 each. NRAM lodged an appeal in early 2015. Follow the Telegraph on LinkedIn. Share this article with your network.
The Court of appeal has reversed a decision that could have led to £ ##500 of compensation being paid to prospective customers with the former bank Northern Rock by the UK government . The court related to Northern Rock 's " Together loan " , and questioned the wording in past loan documents .