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UK mortgage market remains competitive

Date: Thu, 13 Apr 2006

The UK mortgage market is one of the most competitive in the world but the growing number of choices could be confusing for many borrowers.

The Financial Services Authority (FSA) has attempted to simplify the UK mortgage process over recent years but many wannabe property owners remain unclear on the differences between products.

The introduction of new home loans such as offset mortgages could mean that some buyers are not always opting for the most suitable mortgage for their circumstances. There are also concerns that some borrowers are failing to understand crucial differences between products that offer repayment or interest-only terms.

Offset mortgages are loans secured against a property that minus from the value of the existing mortgage loan amount, any money in a customer's savings and current accounts.

However, this particular form of mortgage would not be ideally suited to those borrowers without substantial savings. It also means that customers are forced to remain loyal to one lender as savings and current accounts need to be held with the mortgage-lender.


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