According to recent press reports, homeowners will be hit by rising mortgage bills if the Bank of England heeds economists’ calls to increase interest rates in order to tackle the spiralling price of everyday goods.
The Bank is facing mounting pressure to put up interest rates at a faster rate than previously planned to help slow soaring inflation, which leapt to 5.4% in December, its highest level in nearly 30 years. Millions of households are justifiably concerned about covering grocery, fuel, energy and home loan bills.
In a speech made to Official Monetary and Financial Institutions Forum on Friday, Bank of England policymaker, Catherine Mann, underlined the thinking regarding further base rate rises by saying, “Going into 2022, current price and wage expectations coming from the monthly decision maker panel are inconsistent with the 2 per cent target, and if they are realised in 2022 are likely to keep inflation strong for longer… It should be a concern that the costs from 2021 are becoming reflected in price expectations for 2022.”
Steve Padgham, The Financial Planning Group’s Head of Mortgages, said: “Changing expectations based on current forecasts is essential, and we can all start to take action to soften the impact that further mortgage rate rises could bring. Whether that is switching to a three, or five year, fixed rate mortgage, or by letting us help you reserve a deal for six months so you have flexibility and peace of mind to switch a little further down the line. Either way, it is important to speak with an independent mortgage advisor so you are aware what offers are available for you to take advantage of. Savvy people certainly get the best rates!”
If you’d like to discuss ways of securing a longer fixed rate mortgage deal then please do not hesitate to contact Steve Padgham at The Financial Planning Group via e-mail at Steve.Padgham@fpgonline.co.uk or by calling 020 8977 7090