Warnings of a rise in mortgage rates are being discussed within the industry and this week we have seen a number of lenders increase their rates.
Expect a 13 per cent increase in their mortgage costs by 2023
Office for Budget Responsibility (OBR)
We are being told by the Office for Budget Responsibility (OBR) that homeowners could expect a 13 per cent increase in their mortgage costs by 2023 as rates are forecast to rise to rein back inflation. The forecast runs alongside the OBR’s projection that inflation will peak at 4.4 per cent in Q2 2022 before falling back towards the government target of two per cent throughout 2023.
A rise in mortgage rates will come on the back of increasing interest rates from the Bank of England. Homeowners need to be aware that this is the case. The clock is ticking on the record low mortgage rates we’ve all become accustomed to.
Rise in mortgage rates
Homeowners on a fixed-rate deal now could face much higher rates when they come to remortgage in the coming years. Only yesterday (22 February 2022), Santander confirmed it was going to increase the interest rates on a host of its fixed rate mortgage deals by up to 0.5 per cent, while cutting its tracker rates by up to 0.25 per cent.
“We are urging our clients with rates ending within the next six months to contact us to discuss their remortgage options. We hope that if we look into this sooner rather than later, we will be able to help them secure a better rate,” says Chris Lees, Mortgage and Protection Director at Resolve Financial Solutions.
Many may not realise that remortgaging can take place up to six months before your current deal ends. Therefore giving us time to search the market for the best deal for you and securing that rate.
If you would like to book in for a FREE, initial no obligation mortgage review with one of our advisers, please get in touch.
*Your home may be repossessed if you do not keep up repayments on your mortgage.