Mortgage Hike Alert: 100,000 Households to Face £240 Monthly Increase
As the UK approaches the General Election on July 4, a staggering 100,000 households are bracing themselves for a significant hike in their mortgage payments. According to research commissioned by the Liberal Democrats, based on data from the Financial Conduct Authority (FCA), this increase is expected to amount to more than 3,300 households per day seeing a rise in their monthly mortgage payments.
Mortgage stress is on the rise
Mortgage costs have increased significantly over the last few years, with homeowners facing significant hikes to their housing costs following consecutive hikes to interest rates from the Bank of England and the market response to former Prime Minister Liz Truss’ mini-Budget in 2022.
Currently, the Bank of England base interest rate is 5.25% and has been sitting at this level since August last year. According to data from the financial comparison website MoneyfactsCompare.co.uk, the average two-year fixed residential mortgage rate is today at 5.93%. While this is a significant drop from the July 2023 peak of 6.86%, it’s still much higher than December 2021 when it was 2.34%.
Mortgage rates have skyrocketed
What can I do if I’m struggling to pay my mortgage?
Last year, the Government launched its “mortgage charter” which sets out standards that lenders have to follow to support people struggling with their payments. Advice to customers from the Financial Conduct Authority (FCA) and the Government is that if a customer is in arrears - so has missed a mortgage payment - or at risk of arrears, they should speak to their mortgage provider as soon as possible.
Seek help if you’re struggling with mortgage payments
As the mortgage landscape continues to shift, it’s essential for homeowners to stay informed and take proactive steps to manage their mortgage payments. With the General Election looming, it’s crucial that policymakers prioritize the needs of homeowners and work towards creating a more stable and affordable mortgage market.
A more stable mortgage market is crucial
