Monthly fixed mortgage payments could triple for some households as dozens of lenders raise rates and close the cheapest deals
- Homeowners can see monthly mortgage payments up to three times
- Dozens of companies have raised their mortgage rates or scrapped cheap deals
Homeowners could pay their monthly mortgage payments up to three times as much if dozens of lenders raise rates.
More than 30 companies have increased fixed-rate mortgages or scrapped the cheapest offers in recent days.
On Thursday, Nationwide, HSBC and Barclays became the latest lenders to do so.
The latest move means that at least a third of companies offering home loans have raised their prices.
Homeowners with mortgages taken out in recent years when interest rates were low could be hardest hit by the increase.
(Stock Image) More than 30 firms have increased fixed-rate mortgages or scrapped the cheapest offers in recent days
(Stock Image) A couple described how their monthly mortgage payments have increased by £1,300 every month for the past year
Loans taken out when interest rates were as low as 0.99 percent with the expectation that they would remain at the same level can yield monthly payments as much as double or triple. the I reported.
One couple described how their monthly mortgage payments increased by £1,300 each month for the past year.
Laura and Russell Gibson bought a cottage in Tunbridge Wells for £500,000 in 2018.
Although they used to pay just £1,738 a month for the house’s mortgage, the couple now have to pay £3,000.
Laura said, “We’re getting by now, but we don’t know for how long.”
She added, “We’re proud people so it’s embarrassing to say this is a stretch. We had to make sacrifices to pay the mortgage.
“We will try to make ends meet in the coming months and see what happens. We play it month after month, but have regular conversations about selling, although that’s the last thing we want to do.”
According to research by the Liberal Democrats, the cost of a new mortgage has increased by 38 percent since 2019.
London homeowners who took out a new mortgage in March could pay £2,187 a month, an increase of £615 since the last general election in December 2019.
Party leader Ed Davey accused the government of “shocking mismanagement” of the housing market.
He said: “This is a hard blow to all those who have worked hard, played by the rules and are now struggling to pay their rent, their mortgage and their food bills.”