Paula Higgins, the CEO of HomeOwners Alliance, has a simple message for the Bank of England ahead of Thursday’s meeting: stop raising interest rates now.
While Governor Andrew Bailey has given some hope that we are near the end of the relentless succession of increasing interest rates, the speculation is rates will rise again on Thursday, which will leave millions of homeowners bearing the brunt of the economic policy to battle inflation – yet again.
The Bank Of England Needs To Stop Raising Rates
This needs to stop now. Raising rates from 5.25% to 5.5% would mark the highest level since 2007 and will leave homeowners open to even longer periods of misery.
Soaring mortgage costs are already devastating homeowners’ carefully laid financial plans. The Government’s “help” in the form of the Charter really only bats the problem into the long grass. Most homeowners will struggle along meeting sky-high mortgage payments rather than use the Charter to stretch their loan repayment over a longer period of time and ultimately pay more to the lenders in interest. It’s yet another win-win for lenders at the cost of homeowners.
We’re worried that we have only seen the tip of the iceberg in terms of the impact this punishing series of rate rises is having on homeowners. There are 14 million adults over 20 with a mortgage according to the Institute of Fiscal Studies, and many households will be shielded by their current fixed rate mortgage. But eventually their mortgage deals – many of which would have been fixed at historically low levels of 1% – 2% – will end and they will be faced by crippling costs.
The uncertainty of the current cycle of interest rate rises is also very damaging. Homeowners having to remortgage don’t know whether to act now and fix or hold off. People need to know the situation is stable before they can act.
This is why we’re calling on the Bank of England to stop this attack on homeowners.
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The HomeOwners Alliance is a property advice website providing free expert advice, and campaigning for change. We’ll be updating our popular advice piece on the Best Mortgage Rates again this week after the Bank of England announcement.