Homeowners 'overpaying' mortgages

Posted: 03 Sep 2008 13:05:47 GMT

Despite the relative economic gloom that has descended over the European lending market, more than one in ten (12 per cent) British mortgage holders is planning to make an overpayment in the next six months using "spare cash".

That is according to research from Abbey Mortgages, which revealed that this figures is three times the number (four per cent) of people planning to make underpayments or take a payment holiday.

Interestingly, mortgage payments remain a key financial priority for people even though the economic situation has changed drastically this year. Abbey also found that one in ten people plan to change their mortgage over the next six months.

Phil Cliff, director of mortgages at the lender, said: "A large proportion of mortgages offer borrowers flexibility and the research shows that many people are planning to take advantage of these benefits.

"It's great to see that people are quite rightly prioritising their mortgage payments ahead of other financial commitments - having a smaller mortgage can mean you get a better deal when you remortgage and of course reduces future monthly outgoings."

Last week, a South African property investment firm claimed that London is currently one of the best places in the world to buy property. International Property Solutions said that market conditions were perfect for medium to long-term investment gains.

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