Report Pensioners sue mortgage lender over self-cert interest-only loan in House prices and the economy Posted September 29, 2017 5 hours ago, Confusion of VIs said: I am not so sure about courts deciding all BTL is commercial. The people I know who have these IO loans are owner occupiers, they both thought/were told that by the time the loan matured it would have been inflated away to next to nothing. One now earns enough to easily pay it off the other is widowed and will probably lose her house on retirement. In some cases concerning interest rate swops the courts have decided that a small business did not have the necessary knowledge/legal advice to make an informed decision and have held the banks liable for losses. I can see something similar happening with BTL, I assume that's what the people in this case are hoping. Correct. These cases appear to be fraud. Investors have borrowed money by exaggerating their assets and income, and have pocketed gains. When the time has come to repay the amounts borrowed or if losses occur the investors play the debutant card, saying that they didn't realise the 500k they borrowed was actually a loan rather than a gift. Although all this looks like fraud, it has been an integral feature of the prosperity of UK property owners. It is the only way that 7 trillion in assets could have accrued. In that sense this type of fraud is an essential part of the business model, so it's not surprising that prosecutions are non-existent, even in cases like this where BTL borrowers admit that they obtained money by lying. The fraud is so endemic, it can't be called a criminal offence. I guess much like Greek tax evasion.