With CML figures showing remortgaging at a similar percentage of total mortgage lending to this time last year, despite much cheaper fixed rates and some better discounts being available, Charcol believes that this high level of confusion is preventing homeowners from making substantial savings.
Charcol’s research shows that 71 per cent of borrowers have never remortgaged and over five million of these people have never even considered being unfaithful to their current lender.
Asked by MORI - on behalf of Charcol - which term they thought correctly described remortgaging:
• 42 per cent of borrowers believed it to be “taking out an additional mortgage when you need to raise money.”
• A further 13 per cent either failed to describe the term completely or thought it meant taking out a new mortgage when they moved home.
Alison Cooley at Charcol, said: “It seems all this confusion and fear of the unknown is putting people off taking remortgage action, even when faced with the most compelling incentives to do so since the sixties. The fact is that millions of homeowners are effectively squandering thousands of pounds a year by not taking advantage of the lowest mortgage rates available. These are people who will happily shop around for hi-fis, holidays and motor insurance, but have never even considered the savings they should make by switching their expensive mortgage deal.”
