Mortgage costs are set to keep rising

Cuts to Bank Rate may be expected to ease some short-term financial pressure this year, but a report from the Bank of England suggests that mortgage payments are likely to rise for around three million households by 2026.

Prepare for an increase

The Bank observed, ‘The share of households spending a high proportion of their income on mortgage payments is still expected to increase slightly over the next two years.’ It is predicted that, by the end of 2026, about 30% of mortgage holders will be subject to at least a £100 increase in their monthly payments¹. A typical household will see their repayments go up by 28% to £180 per month, but around 400,000 borrowers could have an increase of 50% or more.

Households show resilience

Although this is concerning, the Bank commented that ‘UK households and businesses have remained resilient to the impact of higher interest rates’. Also, it is forecast that the number of mortgage holders who cannot meet their payments will remain below the figure seen following the 2008 financial crisis.

Don’t panic, seek advice

We can help you to manage your finances, considering any potential increase to your mortgage repayments.

Your home may be repossessed if you do not keep up repayments on your mortgage

¹ BoE, 2024

18 September, 2024

More news

22 May, 2026

For many people, buying a home is one of the biggest financial commitments that they will make. But

What can you afford? We strongly recommend that you sit down with a professional adviser to ascertain what you can afford, based on your current financial situation. As well as your deposit and monthl

19 May, 2025

The cost of moving home in England has jumped 10.9% over the past year, according to new research fr

The average mover now faces a total bill of £51,826, with a 15% mortgage deposit costing £43,585, making up the largest share. However, changes to Stamp Duty relief thresholds have also driven costs

9 May, 2025

Around 11% of divorcees haven’t remove their ex-partner from their Will, risking their estate goin

L&G also says a tenth of divorcees have not updated who should receive their life insurance payout. Meanwhile, only a small number take out new cover after divorce, with 4% buying critical illness