How Much Extra A Year Could Your Mortgage Cost?

by | Tuesday 13th Dec 2022 | Mortgage News

The role of a mortgage advisor is to help you and guide you in finding the best, most affordable and manageable mortgage deal for your circumstances. For those people who decide to arrange their mortgage on their own, this can sometimes backfire and you may end up paying more than you should for a straight forward loan. This year more than ever, we have seen the importance of enlisting the help of a mortgage professional as mortgage cost went through the roof. The people who didn’t secure their mortgage through a professional advisor were left scratching their heads about how to bring their costs down!

How Much Extra Will a Mortgage Cost In 2023

But it isn’t just these borrowers who find themselves worse off per month with rate increases, the Bank of England have warned that next year, four million borrowers are potentially facing higher repayments on their mortgages. It is yours and your mortgage advisor’s responsibility to get ahead of things and make sure that you aren’t too badly impacted by and rate rises. If your fixed rate is coming to an end and you are in need of a new product, speak to your advisor as soon as possible so that they can secure a competitive rate.

It is predicted that the average monthly mortgage payment is set to rise to £1,000 from £750. That is roughly 17 per cent of an average borrowers pre-tax income. That also means that the average borrower’s mortgage could potentially cost an extra £3,000 a year if rates keep increasing. With this increasing mortgage cost being experienced by millions of borrowers comes an inevitable prediction that things like mortgage arrears or struggles with paying back property finance. The BOE predicts that a potential 2.4% of all households could find themselves in financial difficulty.

What The Mortgage Brokers Say

Louis Mason from Oportfolio Mortgages in Southwest London had this to say:

“If I had a mortgage that was coming to the end of it’s fixed rate within the next 6 months, I would be straight on the phone to an advisor. Not just because I am in the mortgage industry myself, but because I would want to do anything I could to make sure that I was financially secure and could get the best mortgage deal possible. Mortgage advisors aren’t magic unfortunately (although we can sometimes pull of some incredible miracles!), and we can’t promise you that rates will come back down to the levels they were. But what we can do is help you to find the most competitive deals and repayments that are affordable for you. So that you can stay comfortable for longer and so that you are prepared for anything that the economy might throw at you.”

If you or anyone you know is worried about mortgage cost increases, you can always give our friendly advisor team a call for a free initial mortgage chat. Our advisors can do the whole process with you over the phone, via zoom, or face to face if you are local to our office. We are here to help.

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If you have any questions about UK mortgage news or or anything you’ve read then please get in touch. We’d love to hear from you.

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