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Bank of England announce another mortgage interest rate rise

A group of business women working together on a tablet

The Bank of England have just announced its latest decision on an interest rate rise, increasing it by 0.5% to 1.75%. This is the sixth time in a row the rate has increased since Dec 2021, and makes it the single biggest rise for 27 years. 

This means that cost of borrowing is becoming higher, with the English Housing Survey saying about two million people in the UK will see their monthly mortgages, credit cards and loan payments rise significantly as a result.

Now really is the best time than ever for clients to fix their mortgages whether you are purchasing a property or re-mortgaging. 

Why Now? 

Clients need to act fast. This is because some Lenders have limited availability on each mortgage and when they hit their target, they won’t accept new borrowers and will pull their best products and rates out of the market. Borrowers will then find that even fixed rates are higher than expected.  

As inflation continues at a record high this means rates will continue to increase, therefore by fixing now, clients have protection against any further rate rises. 

How to find the best fixed rates for clients? 

Any client on a variable rate will benefit from a mortgage review with us. Even if clients are already fixed into their mortgages, if they’re within six months of their fixed rate coming to end, they can still get in touch. Now is a good time for them to speak to us to see if we can either switch products with the same lender, with low or no redemption penalties, or find them a better deal elsewhere.

How long should I fix my mortgage?

Lenders are typically offering 2,3,5,7 and 10-year fixed rates. Depending on a client’s circumstances, the longer a client fixes the term, the more certainty and stability they have that their monthly payments will not change during the term they are fixed in. We are currently seeing a big demand of clients fixing their mortgages over 5 years. 

Rate increases over the last month. 

These illustrations below give you a comparison of the 5-year fixed rate product with top lenders, between July and August 2022 - Based on a £200k property purchase, with a deposit of 5%, 20% and 40%. 

There is clearly a rate increase this month.

Fixed rate period

LTV 95%

LTV 80%

LTV 60%

2 years

3.79% 3.37%


5 years 

3.89% 3.48%


10 years

5.09% 3.56%


Aug 2022 

Fixed rate period LTV 95% LTV 80% LTV 60%
2 years 3.44% 3.06% 2.99%
5 years 3.64% 3.28% 3.10%
10 years 4.89% 3.49% 3.33%

July 2022 

Sources: Twenty 7 Tec Platform (Thursday 4th August), BBC News, and Money to the masses via Google.

Posted by Fidelius on August 10th 2022

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