UK interest rates rise in biggest increase for 27 years - how it will affect you and your mortgage
04.08.2022 - 14:33
/ manchestereveningnews.co.uk
The Bank of England has today (August 4) announced a 0.5 per cent rise in interest rates in the UK, with the current rate now standing at 1.75 per cent - the biggest rise since 1995.
This is now the sixth consecutive rise voted by members of the Bank’s Monetary Policy Committee and the fifth rise this year, after a vote to increase rates from 1.25 per cent to 1.75 per cent.
The interest rate hike is yet another blow for households who are being crippled by rising bills in the cost of living crisis. The 1.75 per cent rise is now expected to increase monthly repayments for millions of homeowners on variable rates mortgage deals and other forms of borrowing.
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Mortgage Advice Bureau has Explained how the change in interest rate will affect you and your mortgage - and what homeowners should do to help manage their repayments.
Depending on the type of mortgage you have, you may or may not be affected by the interest rate rise.
"Homeowners whose mortgages are directly linked to the bank rate may see an increase in monthly repayments," explained Brian Murphy, head of lending at Mortgage Advice Bureau.
"Those who are on lender revert rates or Standard Variable Rates (SVRs) will have to wait and see if their lender will pass on the rate increase in full or only in part. Those who have a tracker rate mortgage are more likely to see the rate passed on in full, and possibly as soon as their next mortgage payment."
Brian added: "A fixed rate mortgage could provide a temporary safe haven against upcoming interest rate rises as their fixed interest rates are guaranteed for a set time period.
"If you’re re-mortgaging, make sure to speak to your