Brits wasting billions each year through failure to remortgage

27th March 2017

L&C Mortgages has revealed that 36% of homeowners are on a standard variable rate mortgage (SVR). Not only are these rates typically higher, but if interest rates rise, the four million people who are on SVR mortgages could see their payments rise further.

The L&C research highlighted that a further 1.1 million households are wasting £2.78 billion by sitting on the wrong mortgage deal. It claims that by switching to a better deal, UK homeowners could save £216 each month, or more than £2,500 annually.

Surprisingly, 58% have never remortgaged to save money and 3.4 million households don’t know their current mortgage interest rate.

David Hollingworth from L&C Mortgages said: ‘’It’s worrying to see so many people still on a standard variable rate mortgage as they are not the cheapest rates available. Not only is there a lack of awareness around how much could be saved, but, worse still, a huge number of people have never even tried to remortgage to get a better deal.

“With the cost of living on the rise and day-to-day expenses like energy prices soaring, it is hugely concerning to see that people are paying so much more than they should be.  On top of this, our research shows that while homeowners believe they are paying too much for their mortgage they still aren’t taking action to cut their monthly payments.”

Hollingworth added: “A mortgage is likely to be someone’s biggest monthly outgoing, and in only a few easy steps they could get a better deal. It’s crucial that homeowners regularly review their mortgage, to see how their rate stacks up against the record low rates that alternative deals currently offer.”

*2 year fixed with TSB 1.09% then 3.59% - APRC is 3.3% Max LTV is 60%. Quoted on 27th May 2020.