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Tracker mortgage holders urged to overpay
Fri, 14 Nov 2008
The recent cut in the Bank of England base rate could help mortgage holders pay off their loan six years early, according to one expert.

Drew Wotherspoon, director of broker John Charcol, explained that if people on tracker mortgages are able to maintain their payment at the old rate then they will shorten the life of their account considerably.

He said: "As interest rates fall, it provides the perfect opportunity for borrowers with trackers to pay their mortgage back quicker, without noticing any difference in their pocket every month."

By doing so, people will also save money in the long run as they will pay less interest on their mortgage, Mr Wotherspoon added.

However, if people have other, more expensive debts, they should pay these off before concentrating on their mortgage, he stated.

Yesterday, James Caldwell, director at Fairinvestment.co.uk, stated that the decision by Abbey, Lloyds TSB and Alliance and Leicester to reintroduce tracker mortgages is a step in the right direction for the market.

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