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Mortgage overpayments increase

Mortgage overpayments increase

Category: Mortgages

Updated: 26/02/2009
First Published: 26/02/2009

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Research has found that the number of people who are making overpayments on their mortgages has doubled in the last year alone.

Eighty per cent of the people who said that they overpaid cited the current low return on savings as their main motivation for doing so, while 37 per cent said that the fall in the base rate was a contributing factor, according to the Co-operative Bank.

Terry Jordan, head of mortgages, commented: "Our internal data has shown a 50 per cent increase in our mortgage customers making overpayments. It would appear that with interest rates now at an historic low, customers are recognising more than ever the benefits of making overpayments"

Almost one in ten people (seven per cent) questioned said that they had made overpayments in the hope of securing an improved mortgage deal, by increasing equity in their homes.

Of those who said they did not overpay their mortgages, 29 per cent said they preferred to put money into savings, with a further 24 per cent preferring to spend their hard earned on holidays and clothing.

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