An estimated 83% of homeowners do not understand the details of their own mortgage, according to research from Boon Brokers.
An estimated 83% of homeowners do not understand the details of their own mortgage, according to research from Boon Brokers.
The data shows that this is due to individuals not understanding the fees and interest rates associated with their mortgage.
In addition, 12% of homeowners admitted they generally found mortgages very confusing.
Younger homeowners aged 18-24 were most likely to misunderstand their mortgage terms, at 13%, whereas 3% of mortgage holders over 65 felt the same.
People aged 45 to 54 were most likely to feel confident of the details of their own mortgage.
The research from Boon Brokers also revealed that 22% think lessons on mortgages should be given at school, with 25% of women thinking it would be a good idea and 18% of men.
The data is based off of the results of 1,100 UK mortgage holders.
Gerard Boon, founder and partner at Boon Brokers, said: “There is a lot of misunderstanding around mortgages and really it is no surprise as there is very little in formal education about personal finances.
“It can be difficult to know the questions you should be asking or the things you should be looking out for if you are wanting to take out a home loan.
“The fact that eight out of ten people aren’t clear on the terms of their own mortgage is very concerning.
“At the very least homeowners should make sure they are aware of their mortgage rate and whether they are tied into that for any period.
“It pays to be alert to when any fixed rates will end, so you can make sure you switch to a competitive rate, rather than automatically being transferred to a more expensive deal.”
