The reality is you may very well end up paying more interest than the person who chooses a different rate and different FEATURES. Features that can work in your favour and that you need to be aware of can include:

FEE-FREE EXTRA REPAYMENTS - Paying just an extra dollar a day off your loan will result in significant savings in interest and see you mortgage-free far sooner. That makes increasing repayments (at no extra charge) a feature worth having.

PORTABILITY - This allows you to sometimes transfer your existing loan to the new property when you move house, meaning you could avoid having to pay break costs for your old loan or establishment fees for a new loan. However this may not be an option or may be a more costly alternative when all factors are considered.

REDRAW FACILITY - Provides access to any additional repayments you’ve made. Handy if you’re short of cash in an emergency, but it will put you behind in terms of interest savings.

MORTGAGE OFFSET OR REVOLVING CREDIT - An offset or revolving credit account lets you put any savings to work to reduce your loan interest charge. The balance of your savings is deducted from the loan when interest is calculated, so you pay less interest, with more of each repayment reducing the loan balance.

MORTGAGE HOLIDAY -  This feature offers a complete holiday from repayments or a period of reduced interest only repayments. This can be especially useful during career changes, ill health or breaks such as maternity leave. Ideal to include if you are just starting out and having a family.

So before you or someone you know makes this mistake – give them this newsletter or tell them to head to our website and get in touch with us so we can help them.