A recent survey commissioned by first direct reveals that 40 per cent of homeowners don't understand the basic idea of an offset mortgage and a further 35 per cent only roughly know how they work.
This worrying trend highlights how consumers may be missing out on saving money and reducing the term of their mortgage with just two in ten (21 per cent) seeing offsets as a way they can save money on their mortgage.
Findings from first direct show that swapping to an offset mortgage could cut down the length of a £100,000, 25 year mortgage by four years and save £24,232 in interest payments over the lifetime of the mortgage.
First direct's head of mortgages, Jimmy Kelly, said: "It's a real worry that consumers are not aware of the benefits of an offset mortgage."
Date: 25th, November, 2009
Author: Ben Wilkie
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