How will the Bank of England’s decision to set the bank interest rate at 4.25% today affect UK homeowners to hold a residential mortgage, according to data from UK Finance Corporation.
The interest rate setting panel lowered the base rate by 25 basis points at its last meeting in May, but Most economists predict that they will stop before further reductions.
Last week, Steve Matthews, investment director for Canadian Lifesaving Asset Management, said: “We expect the Bank of England to maintain a steady pace this month. Inflation remains persistent, employment data is stable, and GDP prints have been benign – indicating no immediate further cuts are needed.”
The National Bureau of Statistics also announced yesterday Inflation remained at 3.4% in May.
Yesterday, L&C Mortgage Deputy Director David Hollingworth, layoffs today “will be seen as shock.”
UK Finance has published figures to show average monthly payments and interest rates for a variety of different mortgage types.
Tracker – Average balance outstanding £139,042.
SVR – Average balance outstanding £66,576
Fixed – Average balance outstanding £167,691
In this representative calculation, the average current mortgage rate for the tracker is 5.93%. The SVR was 7.38%, fixed at 3.65%.
The current average monthly interest payments are £687, £410 and £510, respectively, and the average total payment (borrower used for capital and interest) is £991, £652 and £943 in three mortgage types.
UK financial data shows that SVR has a fixed mortgage of about 7.1 million, tracker mortgages and 540,000 borrowers, accounting for 81%, 7% and 6% of mortgages, respectively.
