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Britons unaware of true cost of mortgage

More than three out of four Britons are unaware of the true cost of buying a home, according to a new survey from Virgin One.

Less than a quarter of respondents could estimate within £50,000 how much a £200,000 mortgage would cost to repay.

The survey asked homeowners if they were to buy their dream home with a £200,000 mortgage how much they would pay back in total. One in three thought they would pay no more than £250,000. In reality a repayment mortgage would cost a total of £393,946 and £509,997 on an interest only basis over 25 years.

Virgin One marketing director Scott Mowbray says: "Many banks and building societies are falling over each other to lend out as much money as possible to homeowners, yet they are clearly not spending as much effort in explaining how much it is going to cost to repay."

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