Mortgage deals are 'double-edged'
Published On 14 June 2007
The introductory offers available on many mortgages can provide a good deal for consumers but also stop them shopping around for the best long-term deal, an industry expert has warned.Christopher Dean, a spokesperson for the Council of Mortgage Lenders (CML) explained that that headline introductory offers on mortgages could be something of a "double-edged" issue.
"On one hand the consumer might be getting a really good deal from a lender, but on the other hand that may be discouraging them from shopping around," Mr Dean said.
"What they really need to do is keep their eye on the ball really; keep their eye out for the products that will suit them and weigh up all the costs and perhaps, not look at just the introductory rate but look at how the product will affect them…over three, five, ten years."
Despite this, Mr Dean added that mortgage lenders in general were "upfront about the terms of the product they're providing" and made efforts to make sure consumers understood the borrowing they were taking on.
Recent figures from the CML show that the average first-time buyer in the UK has to now use 18.7 per cent of their income servicing the interest on their mortgage.
In responses to this, some lenders have suggested that mortgages with a 50-year term could be introduced.
