Interest rates held at 15-year high
The Bank of England (BoE) has announced it’s keeping interest rates at a 15-year high of 5.25%. Rates have been at this level now since August following 14 consecutive rises starting in December 2021 when they were just 0.1%.
BoE Governor Andrew Bailey has said rates need to stay high for a while to kill off high inflation.
Although inflation is down from the 41-year high of 11.1% witnessed in October last year, at 4.6%, it’s still more than double the BoE’s target and higher than in other comparable countries.
The BoE is likely to want to see inflation get closer to its 2% target before cutting interest rates. Experts are predicting the first cut is unlikely to come earlier than the summer.
Struggling with housing costs?
With interest rates remaining at a 15-year high, many people are facing higher housing costs, as mortgages become more expensive and landlords pass on rising costs to tenants.
Worried about paying your mortgage?
If you’re worried about keeping up with your mortgage payments, speak to your lender.
Sebrina McCullough, our head of external relations, said:
“Our advice to anyone struggling is to get help as soon as possible – you’re not alone. Make use of the Mortgage Charter formed by mortgage lenders, the FCA and the government, allowing homeowners to switch to interest-only payments or extend their mortgage term to reduce their monthly payments for six months – neither will affect your credit score and can be done without affordability checks.”
She also urged people to make sure they're getting all the government help they're entitled to:
"With over £15 billion in benefits going unclaimed each year, it’s worth checking what extra support is available as it could prove to be a lifeline.”
You can also find more information on the help that’s available in our guide what you should do if you fall behind with your mortgage payments.
Rent costs spiralling?
If you’re renting and your landlord is trying to pass on rising costs to you, it’s important to know your rights to avoid being exploited. In most circumstances, your landlord can only increase your rent once a year by a reasonable amount. Find more information on your rights and what to do if you're struggling to pay.
There are also ideas on how to make savings in other areas and information on the help you can access if money worries are affecting your mental health in our blog how to manage rising rents and mortgage interest rates.
If you can no longer cover all of your financial commitments, we're here to help. Access our free debt advice online 24/7 or over the phone by calling 0161 518 8282. We’re here Monday to Friday 8am-8pm and over the weekend between 10am-4pm.
A qualified journalist for over 15 years with a background in financial services. Rebecca is Money Wellness’s consumer champion, helping you improve your financial wellbeing by providing information on everything from income maximisation to budgeting and saving tips.
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