By: Sarah Williams

The most significant financial commitment many of us will ever make is buying a home. Yet, as house princes continue to rise, it is becoming increasingly difficult for many to afford it. So why are so many homeowners struggling to maintain their mortgage payments?

Research carried out by Trussle gives a much clearer insight into the worrying amount UK homeowners are overpaying on their mortgage. They claim the average homeowner is losing out on £2,844 a year. With banks and other lenders earning £57 million a day from their customers overpaying — £22 billion a year. These results are extremely worrying and demand action.

Why are so many overpaying?

Property prices are becoming increasingly unaffordable and as a result, lenders have offered smaller deposits, longer mortgage terms and lower initial interest rates to give first time buyers a helping hand onto the property ladder.

Although, in order to compensate for these lower introductory rates, lenders are hiking up interest rates at the end of the initial rate period. This means most homeowners will move onto a standard variable rate, which costs the average borrower an extra £250 a month. Monthly mortgage payments can almost triple when the initial rate period ends due to increased interest rates.

Of the thousand people surveyed across the UK, 69% haven’t switched since moving to a higher rate. Meaning, 7 in 10 of mortgaged homeowners pay too much, either from reluctance to switch, not understanding they can or wrongly trusting banks to let them know when they should.

What’s stopping homeowners from remortgaging?

Research shows people are twice as likely to switch bank accounts, car insurers, and gas or electricity providers than their mortgage provider. So what’s stopping them from remortgaging?

It seems those in a position to remortgage are less likely to switch due to a lack of understanding. Of the 1000 people surveyed, 42% said they find mortgages confusing and 79% think important details are hidden in the small print by lenders.

This is not a shocking revelation, given the specialised terminology and principles used within the mortgage industry. However, Blossomfield reassure the process isn’t quite as confusing as you think, and with guidance from one of our advisors, offering plain-English advice, — we can help you switch with ease.

Switch! To stop losing out on up to £2,844 a year, look into switching to a better deal. Make sure to: find out when your initial fixed term ends or has ended, and shop around for the right deal. Blossomfield Mortgages can offer a free initial consultation, get in touch to see how much you could save.