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Borrowers 'unaware of rate charges'


Wednesday March 3rd 2010

Homeowners are being urged to review their mortgage payment protection schemes after new research revealed that more than a quarter do not know what interest rate they are being charged.

The Post Office survey revealed that 28% were unsure of the rate they were charged, while 35% of homeowners are on the standard variable rate (SVR).

The SVR rate is used when borrowers' existing deals come to an end.

Low interest rates and high deposits being demanded by lenders mean people are better off on the SVR rates than if they switched.

But borrowers are more vulnerable to interest rate changes.

Marco Hughes, personal lending director at the Post Office, said: "Some providers have increased their SVRs quite significantly even though the Bank of England base rate has not moved and as a result many borrowers are seeing their monthly mortgage repayments increase more quickly than they thought."

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Copyright © Press Association 2010

If you're looking for great value, high quality Mortgage Payment Protection Insurance with added benefits you've found it.