Government offer to homeowners receives luke-warm welcome

Posted: 21 Jan 2009 11:53:26 GMT

The latest deal to homeowners struggling with mortgages should not be seen as a "free lunch", the Council of Mortgage Lenders (CML) has said.

The government has offered a scheme in which homeowners can defer some of their monthly mortgage payments, but it should not be seen as a free ride and could come back to haunt homeowners, the organisation has warned.

Michael Coogan, director general of the CML, said: "This scheme is not a payment holiday or a free lunch, but rather a payment deferral.

"The future impact on borrowers' repayments may be very significant if they defer a high proportion of their interest, and the scheme is not without the risk of potentially unwelcome impacts on lenders."

With many homeowners stretching themselves as a result of their high mortgage repayments, the decision to downsize may also be an attractive one.

Homeowners hoping to achieve a high sale price for their existing homes may find that selling their property online can benefit them, as a greater number of buyers may see the property.



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