1.2 million hit by outdated mortgages

An investigation by Charcol has revealed that 1.2 million homeowners have not reviewed their mortgages since the early nineties.

13:46 24 August 2004

An investigation by Charcol has revealed that 1.2 million homeowners have not reviewed their mortgages since the early nineties.

The leading independent mortgage adviser found that this staggering number still have the same deal they had in 1990 - the year of a 14 per cent Base Rate.

For the most part this is due to severe misconceptions. For example, about a quarter (27 per cent) think they are tied in to their current mortgage and as such are unable to switch.

Charcol's Ray Boulger said: "Having held their mortgages for well over a decade, these homeowners are almost certain to be stagnating on their lender's standard variable rate, without any penalty clause to keep them there."

He added: "We're urging more than a million victims from the era of record high interest rates who have still not remortgaged to consider moving to one of the cheaper, far more flexible deals now on offer."

The research found that only 46 per cent are aware they are on their lender's standard variable rate and a further 51 per cent could only roughly guess what the current interest rate is.

A staggering 86 per cent admitted to knowing they are not on one of the best deals

Mr Boulger concluded: "Switching to a better deal should be at the forefront of most borrowers' minds regardless of how long they have held their mortgage. The initial cost will only be their time, while the benefits could run into thousands of pounds."