Tracker borrowers failing to overpay
Instead of reducing the amount outstanding and the term of their mortgage, 31% of those not overpaying are treating themselves, 38% are paying off other debts, 12% are balancing their current account and 17% are increasing their savings in deposit accounts.
Richard Winder, spokesperson for Unbiased.co.uk, said: “Tracker and standard variable rate mortgage borrowers have watched interest rates plunge to record lows in recent months, presenting an ideal opportunity to pay down more quickly the amount of the outstanding mortgage. Such action would enable millions of borrowers to take years off their mortgage repayment term or enjoy a greater level of repayment comfort down the line, should the recession begin to bite harder.
“Our initial research suggests most tracker borrowers are not taking this action, however we’re encouraged by the large number who are using their repayment savings to erode their more costly credit card and personal loan debts.”