FCA: People with interest-only mortgages must plan ahead

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More than a million people with interest-only mortgages face a financial crunch when they have to pay them off, a watchdog has warned.

Some 2.6 million UK householders have the mortgages but the Financial Conduct Authority (FCA) says estimates suggest nearly half will not have savings or other funds to cover the final bill.

The average shortfall is £71,000, according to FCA research, although many of the mortgages in question will not mature for several years.

In an interview with the BBC, Martin Wheatley from the FCA said that homeowners should plan ahead from now to ensure that they had sufficient funds to repay the capital borrowed.

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