<\/p>\n
The impact of the Iran war means a million more homeowners face higher mortgage bills than the Bank of England had previously expected.<\/b><\/p>\n
Just over five million homeowners should expect their monthly mortgage repayments to increase by the end of 2028, according to Bank forecasts.<\/p>\n
That compared to four million projected by the Bank in December.<\/p>\n
However, the Bank’s Financial Stability Report said the hit would not be as hard as seen in recent years.<\/p>\n
A typical owner-occupier rolling off a fixed rate in the next two years is likely to face an increase of \u00a345 on their monthly mortgage bill, the Bank said. That compares to a typical rise of \u00a3120 for those getting a new deal between the end of 2022 and end of 2024.<\/p>\n
However, 750,000 homeowners who are paying less than 3% interest on their current deal would be rolling off these products this year and would see an average increase of \u00a3170 per month in repayments, the Bank said.<\/p>\n
More than eight in 10 mortgage customers have fixed-rate deals.<\/p>\n
The interest rate on this kind of mortgage does not change until the deal expires, usually after two or five years, and a new one is chosen to replace it.<\/p>\n
More than two million borrowers on a two-year fixed deal expiring by the end of 2028 were projected to remortgage close to their existing rate and see little change in repayments, the Bank said. <\/p>\n
However, these borrowers were now unlikely to see repayments fall over coming years, as had been forecast prior to the Iran conflict.<\/p>\n<\/div>\n