- Tuesday, 27 April 2010Debt management is a more pressing concern for a significant number of homeowners on tracker mortgages than taking advantage of low rates with overpayments, a new study has shown
Those with the means to overpay their mortgage while rates are low could benefit in the long-term, however research from Unbiased.co.uk has shown that clearing existing debts is a higher priority for one in five people on tracker deals.
Of those who said they are not overpaying their mortgage while rates are at 0.5 per cent, 28 per cent admitted they are using money saved to pay off other debts.
Worryingly, a quarter said they were using the extra money on day-to-day expenses, rather than using it to improve their financial situation.
Karen Barrett, chief executive of Unbiased.co.uk, added that keeping money in a savings account is quite an ineffective strategy at the minute.
"Those who are instead putting the extra into a savings account are missing out, as interest rates on savings also remain at a record low," she explained.
Recently, a poll by the Post Office indicated that effective
debt management could help reduce emotional and physical stress.
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