The Sunday Times - When will rates rise and how do you prepare? November 2013

by Aaron Strutt

Nov 18 2013

Mark Carney, the Bank’s governor, has indicated that rates will not start to rise before unemployment falls to at least 7%. This was expected to occur in late 2016. But in its quarterly inflation report, the Bank said the target could be hit sooner.

More than 3 million mortgage borrowers are on a variable-rate deals linked to Bank rate. An increase of 0.25 points would add £74 a month to capital repayments on a £200,000 mortgage currently at 3%. A further one-point increase to 4.25% would push up repayments by £138.

Aaron Strutt at the mortgage broker Trinity Financial told The Sunday Times that existing borrowers take advantage of low rates while they last by overpaying. He said: “Clients see low rates as an opportunity to make a dent in their outstanding mortgage balances.”

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November 17, 2013