HAMPSHIRE homeowners saddled with huge debts after taking out Shared Appreciation mortgages (SAMs) are being urged to join action groups.

One of these is planning to bring a test case that could prevent homeowners having to pay massive sums several times larger than the original loan.

As reported in the Daily Echo yesterday, SAMs were offered in the 1990s by Barclays Bank and the Bank of Scotland.

The interest-free loans allowed people to borrow a fixed amount that did not have to be repaid until they died or sold their home.

However, there was a sting in the tail - a clause that enables the lender to grab 75 per cent of any increase in the property's value.

Soaring house prices mean SAMs customers who want to sell their home must pay the banks vast sums that would devour most of the sale price.

Retired decorator Reg Baylis, 69, of Holbury Drove, Holbury, is among those trapped in a property they want to leave.

The Daily Echo revealed how Mr Baylis secured a £20,000 SAM from Barclays in 1998 to pay for home improvements, including a new roof.

When he decided to sell his bungalow, Barclays valued it at £187,950. They told him he would have to repay the original loan plus a huge percentage of the property's current value, a grand total of £96,690.

The pensioner has sought the help of Struggle Against Financial Exploitation (SAFE), one of several action groups representing the 15,000 victims of a SAM.

Other groups include the Shared Appreciation Mortgage Group (SAMAG), which is hoping to bring a test case.

SAMAG has launched a fighting fund and has asked each member to donate £10 a month to fund the case, which is expected to cost at least £60,000.

Another group, Shared Appreciation Mortgage Victims, wants the banks to review "the moral implications of the products and the credibility of their calculations".

A spokesman said: "Many people are still unaware of the full extent of their plight and we would urge anyone who took out a SAM to contact us for facts, information, and help on how to approach the problem.

"The documents supplied by the banks gave unclear and misleading information, which resulted in borrowers misinterpreting the facts."

Barclays says customers were obliged to seek independent legal advice and sign a form saying they fully understood the terms of the mortgage.

A spokesman said: "The product was designed for people living in their final home who wanted to release some of their property's value and enjoy a better quality of life.

"The money they received could be spent on medical care or home improvements - things they wouldn't normally be able to afford.

"At the time the mortgages were offered, nobody could have predicted the substantial increases in property prices that have taken place over the past few years.

"If the value of their property had declined, the borrower would have repaid only the original loan."

New Forest East MP Dr Julian Lewis has attacked the now notorious SAMs, describing them as a "classic rip-off scheme".