 has already hiked the base rate seven times this year. Interest rates last rose from 1.75% to 2.25% on September 22. The move will make the cost of borrowing, including loans, credit cards and mortgage repayments more expensive. High street banks use the BoE base rate to work out the interest rates it offers to customers. It means there could be more misery for households who are already grappling with a cost of living crisis. Lifting interest rates is meant to encourage people to save, rather than spend, which in theory should help bring rampant inflation under control. The Bank of England now expects inflation to peak at 11% this October, compared to its earlier forecast of 13.3% in August. It is an increase from the previous rate of 2.25%, and banks are set to pass the latest increase on to borrowers. Here are the four things to look out for this Thursday. 1. Mortgage rates rising The average mortgage holder on the standard variable rate (SVR) could see their payments rise by £1,476 a year if the base rate hits 3%, according to Hargreaves Lansdown. This will mean that a household with a £250,000 mortgage over 25 years on the average SVR rate of 5.4% will see their monthly payments increase by £123. And around 800,000 homeowners on a tracker mortgage directly linked to the base rate will see an immediate rise. Exactly how much more your bill will depend on the type of mortgage you have. Those on a fixed rate are safe for now - but face a huge jump in borrowing costs when they come to remortgage. Around 2.2million borrowers are due to come to the end of a deal that they fixed when the base rate was at a historic low){kind=link}
MILLIONS of homeowners face higher mortgage bills as the Bank of England is poised to hike interest rates this week.
The central bank is expected to increase the base rate by 75 basis points on Thursday, from 2.25% to 3%.
The Bank of England (BoE) has already hiked the base rate seven times this year.
Interest rates last rose from 1.75% to 2.25% on September 22.
The move will make the cost of borrowing, including loans, credit cards and mortgage repayments more expensive.