Research has found that 22% of homeowners, amounting to 3.5m people, are unaware of how an increase in base rate would affect their monthly mortgage payments.
Despite increasing speculation that the base rate will soon rise, the survey showed that 16% of borrowers on their lender's standard variable rate and 13% of those on a tracker rate do not know what an increase would do to their mortgage costs.
A further 16% on standard variable rate and 18% on tracker rates said their payments would increase, but do not think it will necessarily be as much as the base rate increase.
In addition, 20% of borrowers on fixed rate deals were unsure of how a base rate rise would affect them, with 28% thinking that their mortgage payments would go up at some point after the base rate moves.
The research further found that 5% on fixed rates thought they would see an automatic increase.
Predictions of when the base rate will increase are drawing ever closer, but when it happens it will still come as a surprise to many homeowners.
The base rate increase is inevitable and when this happens homeowners need to ensure they are prepared for what it will mean for their personal finances. Those on tracker rates, Standard Variable Rates and even fixed rates are in the dark about how their personal finances will be affected by this change, meaning it's impossible for them to budget for the future.
It's vital for homeowners to regularly review their mortgage arrangements to ensure that they are on the best deal for them.
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