Some 700,000 borrowers face jump in repayments when fixed-rate deals end this year
Some 700,000 British households face a jump in mortgage costs when their fixed-rate deals end in 2025, as upheaval in the UK financial markets over recent weeks threatens to drive borrowing costs higher. Mortgage rates had been projected to fall this year, easing the pain for homeowners. But the recent sell-off in the UK government debt markets, driven by worries over persistent inflation and heavy public borrowing, could keep borrowing costs higher for longer.
But investors have grown increasingly concerned about government debt, sticky inflation and the prospects for the UK economy, which over the past few weeks has driven up government borrowing costs and swap rates. Simon Gammon, managing partner at Knight Frank Finance, said: “Swaps have moved materially so pricing pressure is already there for all lenders . . . if the current trend continues with swaps remaining high, we will probably see mortgage rates move higher across the board.
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