RWP director Hilary Messer said that while 126 people had already issued claims in the action, the expectation is that many more will soon issue.
The claimants are pursuing the banks in a bid to change the terms of their Shared Appreciation Mortgages (Sams). Up to 7,000 claimants could be eligible to take part in the action, Messer said.
Sams, which were sold between 1997 and 1998, allowed borrowers to take out loans secured against their homes at a zero or reduced fixed-rate of interest.
However, on repayment of the loans the borrowers were forced to pay back not only their original loans but an additional charge of up to 75 per cent of the increase in the value of the property during the lifetime of the loan.
Messer said she was first instructed to advise on a challenge to the Sam arrangements by action groups Struggle Against Financial Exploitation and the Shared Appreciation Mortgages Action Group.
She added that, because of the complexities of the claims and the limited resources of the homeowners, the only viable way they could hope to have their claims brought before the court was by way of a group action.
According to Messer, the banks, particularly BOS, had attempted to avoid the GLO being made and “have spent most of the year arguing about whether the claims are suitable for a GLO”.
She has instructed Thirteen Old Square’s David Lowe QC and Duncan Henderson to act for the clients.
Barclays, which is one of 10 defendants named in the action, with the remainder being BOS businesses, instructed Simmons & Simmons senior litigation partner Colin Passmore to defend the claims.
Denton Wilde Sapte head of advocacy Rory McAlpine is representing BOS.