{"id":44208,"date":"2023-12-06T11:39:00","date_gmt":"2023-12-06T11:39:00","guid":{"rendered":"https:\/\/lethal-industry.com\/?p=44208"},"modified":"2023-12-06T11:39:00","modified_gmt":"2023-12-06T11:39:00","slug":"mortgages-repayments-set-to-skyrocket-by-hundreds-bank-of-england-says","status":"publish","type":"post","link":"https:\/\/lethal-industry.com\/world-news\/mortgages-repayments-set-to-skyrocket-by-hundreds-bank-of-england-says\/","title":{"rendered":"Mortgages repayments set to skyrocket by hundreds, Bank of England says"},"content":{"rendered":"

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Almost five million UK homeowners are still set to see their mortgage repayments jump by hundreds of pounds over the next three years, as rising interest rates have heightened risks in the global financial markets, the Bank of England has said.<\/p>\n

The Bank’s Financial Policy Committee (FPC) also found that British banks are strong enough to support households and businesses even if economic conditions get significantly worse.<\/p>\n

About half of mortgage holders have moved to a new fixed-rate deal since interest rates started rising in late 2021, amounting to more than five million households.<\/p>\n

But a further five million homeowners are still due to face higher borrowing costs by the end of 2026, the FPC said in its latest Financial Stability Report.<\/p>\n

Although interest rates have remained steady for the last couple of months, the subsequent rises prior to this have meant thousands of people have been left to pay more for their mortgage when coming off a fixed deal.<\/p>\n

READ MORE: <\/strong> Mortgage sign-ups for repayment plans exceeding 35 years hit record high<\/strong><\/p>\n

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As a result around 500,000 households could experience a monthly increase of more than \u00a3500 by the end of 2024.<\/p>\n

Higher borrowing costs have led to arrears increasing slightly, and more people could fall behind on their payments in the coming years, the FPC said.<\/p>\n

However, the UK banking system is well capitalised, has high levels of liquidity, and “has the capacity to support households and businesses even if economic and financial conditions prove to be substantially worse than expected,” its report said.<\/p>\n

US long-dated bond yields – the interest on government debt – have risen since the previous report in July, with UK, European and Japanese yields following a similar pattern.<\/p>\n

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The property market in China is also experiencing a sharp downturn, which could have a knock-on effect on other areas of the economy.<\/p>\n

The financial system has been broadly resilient, but vulnerabilities could “crystallise” amid higher interest rates and sharp movements in asset prices, the committee warned.<\/p>\n

“The overall risk environment remains challenging, reflecting subdued market activity, further risks to the outlook for global growth and inflation, and increased geopolitical tensions,” the report concluded.<\/p>\n

Bank of England governor Andrew Bailey said: “While the full effect of higher interest rates have yet to come through, borrowers on the whole have been resilient to these changes.”<\/p>\n