Three in 10 mortgage holders (31%) are still worried about interest rates rising, despite a drop in the Bank of England’s base rate in August, a survey by IE Hub has revealed.
Mortgage rates came down for the first time in over four years after the Bank of England dropped cut interest rates in August.
However, a fifth (20%) of people who own a property said their mortgage is much more than it used to be.
21% of homeowners said their fixed low-rate mortgage ends in the next 12 months and 24% of people stated that they will move mortgages when their current rate ends to try and reduce costs.
9% reported that they are struggling to pay their mortgage and a further 6% of people have extended their mortgage term due to previous hikes in interest rates.
Some mortgage holders are already planning ahead, with 16% of people looking into ways of managing paying their new rates.
Dylan Jones, CEO of IE Hub, said: “A mortgage is a major expenditure for many people, so it’s not surprising that for many that are either coming off a fixed deal or who have had an endowment mortgage, this is a worrying time.
“We are nowhere near the high interest rates of the early nineties and yet many people with mortgages would have been used to the record lows seen in 2020 when the Bank of England base rate was at 0.10% and many would have fixed their mortgage deals at that time.
“So, rates of more than 5% are going to be a shock to the household budgets of many when those deals come to an end.”
