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Many homeowners across the UK are abandoning their endowment mortgages to seek alternative financing and coming up empty. Most have been forced to make the change due to lowered returns on their endowment mortgage and it appears as though many may have to rethink their retirement options as a result. This has led several to try to find an alternative to their endowment mortgage, but few can find rates or terms that are acceptable. There are not many avenues available for those seeking to get rid of an endowment mortgage and most are losing out if they try to make a switch to a different kind of loan.

Ann Robinson, of uSwitch, said: ‘This is a real catch-22 for consumers who are struggling to find the funds to pay mortgage set-up costs. By allowing consumers to add fees onto the mortgage, it could be argued that providers are doing them a good turn. This is particularly true for first time buyers where it could mean the difference between getting on the property ladder or not.

‘However, adding fees to a mortgage means that you will be spreading the amount over many years and paying interest for the pleasure of doing so - this is an extremely expensive option and should always be seen as a last resort.”

Related reading: Endowment Mortgage