Homeowners are squandering money by not switching mortgages when their fixed-rate mortgage comes to an end, according to moneysupermarket.com.
Mortgage payers who do not seek out a better deal at the end of the fixed-rate period are likely to face a significant increase in repayment levels if they simply drift into their lender’s standard variable rate (SVR).
Head of mortgages at moneysupermarket.com, Louise Cuming, said: “Providers have long played on the fact homeowners can be slow to react when their deal ends. Switching homeowners to an SVR increases bank and building society profits at our expense.”
The company’s research reveals that one in five homeowners fall into this category. It also found that this laidback attitude to mortgage repayments could cost households an extra £2,600 each over a two-year period.
“This shows how vital it is for homeowners to find the most competitive product when their fixed rate deal comes to an end,” said Ms Cuming.
"People should bear in mind for just a little work comparing mortgages, the rewards can be huge. Anyone coming to the end of a fixed term product should be looking for their next deal now and not leaving it until they have languished on an SVR for a while,” she added.
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