Emma Butler, Moneyfacts.co.uk editor said: "Almost half of consumers being on their lender’s standard variable rate is a worrying statistic. The average standard variable rate currently stands at 6.59%. On a 25 year £100K repayment mortgage this would involve monthly repayments of £680.84. Best buys on Moneyfacts.co.uk show that fixed rates well below 5% are currently available. On the same mortgage but at a rate of 5%, monthly repayments would be £584.59; in other words, by switching to a more competitive product consumers could save almost £100 a month or £30,000 over the full 25 year term.
"Looking at the figures for Child Trust Fund accounts, it would seem that this new savings scheme is not working as hoped. It could be down to lack of promotion or the fact that consumers are finding this scheme and its paperwork too complicated. However, it is clear that the Government has its work cut out if it wants this scheme to be a success."
July poll highlights:
- 46% of mortgage customers are paying the standard variable rate.
- 84% of eligible consumers have not opened a Child Trust Fund account.
- 54% of consumers have incurred charges for going overdrawn.
