Blackpool MP in call for action to help 'mortgage prisoners'

He spoke in a cross-party debate on the issue of “mortgage prisoners” – people who were given mortgages before the banking crash in 2007.

The Financial Conduct Authority has since tightened the rules on people being able to afford mortgages and many are as a result not allowed to remortgage even though they have met all their payments.

Some, with the collapsed bank Northern Rock, had their mortgages sold on by the Treasury to debt companies which do not allow householders to try to remortgage to get cheaper deals elsewhere.

A review has been launched and in the debate Mr Marsden said: “Many of my constituents are affected by this and have come forward with heartbreaking stories.

One person said: ‘I have worked hard to pay off just under £6,000 over the last few years but it is heart breaking to think I have paid over £20,000 more, had I been able to access other products.’

“Another constituent said: ‘We got a Northern Rock Together mortgage literally weeks before the banking crash. The mortgage is now with NRAM. No arrears, making the repayments has been a struggle, but ?we’ve always managed. Since the decline in the housing market we are in negative equity.

"This is particularly problematic in northern areas where the property market has not recovered since the crash.

“There is a moral duty for the Government to act. It was George Osborne’s ‘flog it’ approach to Northern Rock loans in the first place that failed to provide the safeguards for people who were then put into a transfer lottery, with horrendous results.

"We need a formal inquiry, The FCA’s behaviour is as much use as a chocolate fireguard, and it is time this Government... came clean about what they are going to do.”