A warning has been issued over a clause in some mortgage deals that could see British borrowers lose their homes without realising they were at risk.
Certain lenders include an “all monies charge” in their mortgage contracts that mean customers who later take on a personal loan or overdraft could be liable to losing their homes if they fail to pay back the resulting debts, according to a report from Moneynet.co.uk.
With this in mind, the online company has advised British consumers who could find themselves in debt management difficulty to read the small print of any mortgage deal they sign.
Richard Brown, Moneynet.co.uk’s chief executive, said: “It’s shocking that borrowers who believe their additional borrowing is safely separated from their mortgage are actually agreeing to risk the security of their home – something many people would never consider doing.”
Meanwhile, figures from the British Bankers’ Association showed recently that mortgage borrowing rates have weakened considerably during the past six months.