Millions of UK Homeowners Face Soaring Mortgage Bills

Millions of UK homeowners are set to face higher mortgage repayments due to rising interest rates, according to the Bank of England. The central bank's Financial Policy Committee has predicted that five million households will see their borrowing costs increase by the end of 2028.

This is one million more than previously forecast in December. The increase is attributed to the ongoing conflict in the Middle East and its impact on global energy supplies, which have driven up oil prices to $100 a barrel for the first time since May.

The Bank of England's base rate has stood at 3.75% since December last year, with lenders using this rate to set interest rates on borrowing and savings, including home loans. The current average two-year fixed residential mortgage rate is 5.59%, up from 4.85% in February 2026.

Rachel Springall, a finance expert at Moneyfacts, warned that borrowers may face further increases and advised those with expiring mortgages to start shopping around for new deals now.