Mortgage rates up 10% in September
The latest data from the Bank of England revealed that overall average mortgage rates for new business increased again in September 2022, rising by more than 10%
What the Bank of England said
The average floating mortgage rate for new business 3.09%
The average fixed mortgage rate for new business 2.83%
The average overall mortgage rate for new business 2.85%
Average mortgage rates for new business continued rising in September. The rates for floating-rate mortgages increased by 11.6% to 3.09% and fixed-rate mortgage rates increased by 11.0%.
Average floating rate mortgage rates for new business are now 61% higher than they were one year ago whilst average fixed-rate mortgage rates are up 59%.
We expect the increase in mortgage rates to continue, the Bank of England's Monetary Policy Committee meets this week and will announce its decision on the level of Bank Rate at midday on Thursday (3rd November). Most commentators expect to see an increase of between 75 basis points and 100 basis points, this would see Bank Rate rising from its current level of 2.25% to 3.00% or 3.25% an increase of 33% or 44% respectively.
Any increase in Bank Rate will lead to a rise in the new business rates for mortgages, most banks and building societies pass on the full increase to their customers.
Those on fixed-rate mortgages will not be immediately impacted by the Bank Rate rise for the duration of their fixed-rate period. However, it is very difficult to predict what the future levels of mortgage rates will be.
Those on floating-rate or variable-rate mortgages can expect to see their mortgage rate and monthly mortgage payments increase in December.
If you are worried about your mortgage payments or want to see the impact of changes to mortgage rates on your mortgage payments, you can use our mortgage payments calculator by clicking the link below: