Better mortgage knowledge equals bigger savings

Shopping around for the right mortgage could save borrowers as much as £3,000 a year, new research has revealed.

Comparison of the best and worst products available for a borrower looking for a £120,000 interest-only mortgage, showed a vast divide.

The poorest mortgage required monthly repayments of £794 compared to £544 for the best.

Of all the financial services analysed in the study by website Moneyextra.com, shopping around for the right mortgage continued to pay the best dividends.

Robin Amlot a spokesman for the website said: "Despite the credit crunch, it's not only possible to make and save more money by choosing the right products, you can make and save even more now than you could three months ago."

The findings highlight the benefits that being more financially aware can have on consumers. And it comes as there are further calls for personal finance to be taught in schools in a bid to boost the nation's understanding of money issues.

This week the Association of Investment Companies (AIC) unveiled research showing nine out of ten parents and teachers wanted personal finance education to be made part of the school timetable.

And they think mortgages and the house-buying process was the second most important subject, after budget management, for their children to learn about.

Annabel Brodie-Smith of the AIC said: "Parents clearly believe that financial education should be part of the curriculum, even rating it higher than geography and parents clearly feel they have missed out by not learning the basics.

"So it's no wonder they want their children to be better prepared for the wider world."