1.6M UK Homeowners Face Higher Mortgage Costs as Rates Ease
Approximately 1.6 million UK homeowners will soon face higher mortgage costs as their fixed-rate deals expire this year. Meanwhile, major lenders like boa and wells fargo are showing signs of easing rates, offering some relief to borrowers.
The average two-year fixed mortgage rate stands at 5.96%, and the five-year deal is at 5.53%. However, recent cuts by Barclays and upcoming reductions by HSBC signal a potential shift in the market. These moves could attract more customers and boost the market.
Inflation has been falling, but the Bank of England remains cautious. The Monetary Policy Committee will decide on interest rates on 1 August. Despite challenging conditions, the number of borrowers paying only the interest on their mortgages has decreased.
With around 1.6 million borrowers facing rate increases, the recent cuts by Barclays and HSBC, and potential reductions from other lenders like boa and wells fargo, could provide some respite. However, the situation remains uncertain, and borrowers should keep an eye on their lenders' announcements and the Bank of England's upcoming decision.
