Around two million mortgage borrowers will have to find the money to pay higher monthly repayments after the Bank of England raised interest rates from 0.75 to 1% on Thursday.
Those on variable deals could see interest charges climb by an average £25 a month, UK Finance said. It based the figure on the average balance of £121,034, but borrowers owing more will see charges rise even further, The Mirror reports.
Around two million people in Britain have variable-rate mortgages. There are two types: “trackers” and “standard variables”. Tracker mortgages rise and fall according to the changes made by the Bank of England. Standard variable products follow the rate of the bank which has made the loan – most banks are expected to raise these products in line with the rate rise next month.
