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Paying off mortgage loans with credit cards may not be financial disaster

Thu, 25 Oct 2007

According to a recent study, over a million mortgage borrowers in the UK have used their credit cards to pay off their monthly mortgage repayments over the course of the last year. This is largely due to the increased pressure on borrowers by the five interest rate climbs over the period.

However, an industry expert has determined that those people who do pay off their monthly mortgage repayment with their credit card may not be risking financial ruin. The director of the Debt Advice Bureau, Stephen Rose, found that some borrowers pay lower interest on their credit cards than their mortgage .

Rose reportedly commented: "If people are using credit cards it may mean that there are cash flow problems anyway, it really depends what they're paying on the credit card versus what they are paying on the mortgage. There are people out there who have technically bought a house on a credit card and they've done very well. I bought my first property off the back of credit cards and the credit cards were a hell of a lot less than a mortgage ."
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