An interest rate increase of 0.25% could add £324 to homeowners’ mortgages at a time when inflation is running at 5.1% as costs skyrocket, according to mortgage broker Trussle.
The Bank of England has long been expected to increase the Base Rate but has yet to do so. Today’s inflationary figures could however alter the central bank’s plans.
Miles Robinson, head of mortgages at online mortgage broker Trussle, comments: “While house price growth remains buoyant, it’s shaping up to be a difficult winter for household finances in general.
“Families are facing a steep rise in energy bills and an increase in the general cost of living. This squeeze in consumer spending will almost certainly impact people’s ability to save for deposits and ultimately move home. As such, we could well see house price growth begin to stall.
“People’s thoughts are also beginning to turn towards a possible rise in interest at the end of this year. While it may seem small, an interest rate rise of just 0.25%, which is a likely scenario, could add £324.48 onto the average mortgage per year.
“As such, now is a good time for people to start looking at their outgoings, and mortgages are the perfect place to start. Most homeowners have one, but many don’t understand just how much they can be overpaying by not having the right product for them. Speaking with an independent adviser can help you understand your options to remortgage and make the best choice.”
