Brits have set their sights on tackling their mortgages in 2008…

While many Brits will be heading to the gym to shed their excess pounds after Christmas over-indulgence, up to half of all British homeowners will be flexing their financial muscle to try and shed pounds from their mortgage in 2008, predicts Standard Life Bank.

These 9.6 million people are raring to be mortgage free as soon as possible and will be using the New Year to plan their finances to make this happen. The research revealed that 97% of those wanting to shrink their mortgage will put strategies in place to achieve their dream of being mortgage free. The top tactic is to make lump sum payments on their mortgage, followed by regularly using overpayment facilities.

One in six (16%) intend to use any profit made from selling a property to help clear their next mortgage. For some homeowners, wiping their mortgage could mean a lifestyle change, with 6% of people proposing to take on another job to raise the funds.

Belt-tightening

But Brits are not averse to tightening their belts to make their monthly mortgage repayments, and rather than signing up for another year at the gym, a third (34%) of Brits would be prepared to forgo this and redirect this money to their mortgage. Holidays, luxuries and socialising would also be willingly sacrificed to focus on mortgage repayments in 2008.

The research also revealed that homeowners have big ambitions for their mortgage free lives. Without the financial commitment of monthly mortgage payments, almost two thirds of people (63%) would put more money into savings and investments, or top-up their pension pot (33%). Almost half (47%) would make life changing decisions to travel the world or stop working entirely (9%).

New Year – new opportunity

Allison Crawford, director of marketing at Standard Life Bank, said: "Starting a new year is a great opportunity to look at the goals you want to achieve in the year ahead and plan to make these happen.

Our research found that being mortgage free is the biggest aspiration for many people. Clearing your mortgage entirely may not be suitable for all homeowners, as mortgages can be a savvy financial planning tool when finance is needed.

“However, it is possible to reduce your mortgage significantly without having to make major lifestyle compromises. It’s about setting realistic and achievable goals; for instance, overpaying your mortgage by a small amount each month will make a real dent in how much you owe or reduce the term of your loan."