Three-quarters of Britons incorrectly think that adding 1 per cent onto the rate of interest accruing on their mortgage will have little effect.
When comparing two five-year mortgage deals,28 per cent said they thought the difference on a £120,000 mortgage with an interest rate at 5.6 per cent compared to a rate of 6 per cent would be between £500 and £2000.
Another 23 per cent said they had no idea at all - only 25 per cent correctly identified that the difference could be as much as £4,000.
Overall, older men are the most savvy, with those living in the South East, Midlands and Scotland pipping the others at the post.
If by shopping around, a consumer finds a mortgage deals that saved £4,000, this could cover the costs of:
- The majority of a household’s annual council tax or utility bills: an extra £800 a year would cover a significant proportion of an average £1,100 a year council tax bill or £1,200 a year utility bills
- £65 extra a month towards grocery shopping
- £800 a year towards mortgage overpayments
- An extra holiday a year
