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Consumers with homeowner loans 'can benefit from low rates'

A number of people with homeowner loans can take advantage of low interest rates at the moment, according to an expert.

Bernard Clarke, a spokesperson for the Council of Mortgage Lenders, has said that those who overpay on the loans are particularly able to cut their rates.

He explained that those on variable interest rates have seen borrowing costs cut due to base rate reductions, so overpaying will allow people to "clear the commitment earlier than you anticipated".

"You can do that by not paying the reduced rate but continuing to pay your mortgage at the level that prevailed before rates were cut," he added.

Mr Clarke's comments have come after research from Co-operative Bank Mortgages found there was a 56 per cent year-on-year increase in the number of customers choosing to make overpayments.

It was found that those on variable rates are three times more likely to make such payments than people on fixed alternatives.