View more on these topics

Homeowners unconcerned about potential base rate rise

Research by The MarketPlace at Bradford & Bingley suggests there is widespread apathy amongst homeowners towards interest rate rises.

Over 80% of adults in the UK, are either not worried at all or only slightly worried about interest rates rising in the near future.

Interest rates rising this year won&#39t encourage over half (58%) of homeowners to remortgage to a better deal. Fewer than one in 10 (8%) will definitely remortgage if rates rise by the end of the year and more than one fifth (22%) will want to see another rise before they even consider it.

The research also shows there needs to be a substantial rise in interest rates and monthly mortgage payments before the majority of homeowners will even start to think about a better mortgage deal:

Over half (54%) of adults in the UK say that there will need to be more than a 1% interest rate rise before they would consider moving their mortgage to a better deal.

Nearly two-thirds (62%) of homeowners would not be concerned about an increase in their mortgage repayments until they had increased by over £50 a month, with an apathetic third (35%) having no serious concerns until they saw a £100 or more increase.

Elliot Nathan, product development manager for The MarketPlace, says: “Our research shows the majority of homeowners are completely apathetic about an increase in interest rates and are waiting to see big increases in their monthly mortgage repayments before they will even consider reviewing their current mortgage.

While it is right that borrowers should not be overly concerned about potential rises in the base rate – as they are likely to be moderate – for nearly two thirds (62%) of borrowers to bury their heads in the sand until they see an increase of over £50 a month is alarming when they can remortgage and save this comparatively easily.”

Recommended

Base rate rise could result in extra £1.8bn interest payments

A 0.25% increase in the Bank of England base rate will result in an extra £1.8bn a year in mortgage interest payments – or £152.3m a month, Sainsbury&#39s Bank says. The bank calculates that a client with a £150,000 interest only loan and paying a typical high street lender&#39s SVR of 5.5% would see monthly […]

Keys to the door

Many first-time buyers might be being priced out of the housing market but one group has won more public and government sympathy than the rest – key workers. They even have their own £250m government-funded scheme, the Starter Home Initiative, which aims to help around 9,000 public service employees get a foot on the housing […]

Brokers unsurprised by BBC revelations

Brokers say they are not surprised by damaging revelations about inflated income in self-certification applications, following last week&#39s exposé in The Money Programme. The BBC documentary last week revealed mortgage advisers including branch staff encouraging reporters posing as mortgage applicants to vastly exaggerate their income in order to secure larger loans. The revelations have shocked […]

Marketplace tells borrowers not to worry about potential rise in rate

David Bitner, head of product operations at The MarketPlace at Bradford & Bingley, says borrowers should not be overly concerned about a rise in interest rates. He says: “They are more than likely to be moderate, but to think that many borrowers will just ignore the rise is worrying.” Bitner adds that what is really […]

thimbnail

Almost nine in 10 employers admit failings with post-DRA compliance

The default retirement age (DRA) was abolished more than three years ago, yet new research from Jelf Employee Benefits suggests that the vast majority of employers still have some way to go to fully understand, comply and communicate the landmark legislation change that prevents older employees being forcibly retired on the grounds of age alone.

Newsletter

News and expert analysis straight to your inbox

Sign up