Guest Post: Base Rate Rises Feared by Brits
Research conducted by MoneySupermarket.com has found that 25% of Britons fear the Bank of England base rate rises, after a period of 18th months where the rates have been consistent at 0.5%. Research conducted has found that people are sensing that this base rate can’t remain at 0.5% forever, and some people fear that a rise is coming sooner rather than later.
So how will it affect you?
Mortgages – If the base rate rises, this will increase the price of your repayments. The problem with this is that during the past 18 months you will have become accustomed to paying the low interest rate of 0.5% so getting used to making higher repayments may prove difficult. The only people that the base rate rise would not affect are those that have fixed rate bonds, this is because their rate would be fixed at time of agreement.
Savings – Over half the people who were asked stated that they would welcome an increase in the base rate, as they would see an increase in the interest they gain on their savings.
Kevin Mountford, head of banking at moneysupermarket.com said: “Low interest rates have been fantastic for a large proportion of UK homeowners and subsequently many people have become used to more disposable income each month.
“However, a Base Rate rise will push up mortgage rates forcing many families to reign in their spending – potentially causing financial problems for many.”
View the infographic below, it has some fantastic facts and figures about the base rate rise.