Variable rate mortgages to go up

The main impact of the interest rate rise will be felt by homeowners on variable rate mortgages.

After enjoying historically low rates over the last decade, they will now face bigger payments.

Liam Nash, consultant at Marble Financial Planning in Herne Bay, says many people will be worried about their mortgages.

“At point of writing, five lend- ers have already increased their rates on variable rate mortgages, some credit cards and business loans and we would expect most, if not all, to follow suit with one or two bucking the trend and absorbing the extra cost in order to win new customers,” he said.

“In truth, a large proportion of people are currently on fixed rate deals and therefore do not need to be concerned about any immediate impact and with Mark Carney, Governor of the Bank of England, indicating that they are in no rush to raise rates again, people can take some comfort from the fact that the rate is still only at 0.5% which is where it sat comfortably for an extended period of time, prior to the reduction last August.”