Mortgage costs to surge by up to £3,000 a year as Bank of England warns 4m face higher bills

🔴 Monthly mortgage payments are set to increase by an average of £250 for around four million homeowners next year, the Bank of England has said in a report

The BoE also warned about “significant pressure” on households and businesses due to higher inflation and borrowing costs, but said they were more resilient than before the global financial crisis.

“Falling real incomes, increases in mortgage costs and higher unemployment will place significant pressure on household finances,” the BoE said in its half-yearly Financial Stability Report. But the increased pressure on households is not expected to challenge the resilience of UK banks which will be well equipped to support lending, the Bank’s Financial Policy Committee said.

This is because major banks and building societies have strong balance sheets, higher profits, and have increased their provisions to support credit losses, it said. Furthermore, the FPC judged that households are more resilient now than in the run-up to the financial crisis in 2007 and the recession in the early 1990s.This story is being updated

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