TotallyMoney CEO shares top tips as mortgage payments could rise by £1,139

The average homeowner could end uppaying £1,139 per month more than before the hikes began (Image: GETTY) A rise in the base rate could have the average homeowner paying £1,139 per month more than they were before the hikes began. Any expected hike to the base rate would be the 14th consecutive rise since December 2021. With more than 1.4million mortgage deals coming to an end this year, may homeowners will be facing a fresh financial shock when their repayments skyrocket. Ahead of the Bank of England’s Monetary Policy Committee (MPC) meeting on August 3, research commissioned by TotallyMoney calculated the cost of both a 0.25 and 0.5 percentage points increase on borrowers with a variable rate deal. Following the inflation drop to 7.9 percent, markets are pricing a 0.25 percentage points increase as the most likely option. Mortgage rates have continued to rise following the base rate increases (Image: GETTY) Moneycomms found that a 0.25 percentage point hike would mean the average homeowner on a variable rate will need to fork out an additional £32 per month, with repayments up by £593 from November 2021. Unsurprisingly, Londoners will feel the biggest impact where the average house price was £519,934, meaning a 0.25 percentage points increase would add an extra £61 per month to repayments, meaning the average homeowner would now be paying £1,139 per month more than before the hikes began. Andrew Hagger, Personal Finance Expert,  Moneycomms.co.uk  said: ‘Borrowers, especially mortgage customers due to refinance in the coming months, will hope that this 14 th  successive hike will be the last, but much still depends on the next inflation data due out in just under a fortnight from now  ‘If there’s a further decent correction in the rate of inflation on August 16 it could be that the base rate has peaked for this cycle and that borrowing costs will start to fall. Interest rates are on the rise (Image: EXPRESS) ‘The problem is that any meaningful downward movement in mortgage rates isn’t going to happen overnight, meaning that the six months breathing space that lenders are giving at present may need to be extended to help borrowers come through the other side’.  Alastair Douglas, TotallyMoney CEO shared his five recommendations for mortgage customers. Speak to lenders ‘If you’re struggling to keep up with repayments, contact your lender at the earliest possible opportunity. Both the Financial Conduct Authority, and the government have called on banks to be flexible and supportive. “Your lender could let you temporarily reduce your rate, give you more time to make payments, extend the term of the agreement, or switch to interest only. “And remember, although one in five people think it could, asking for help won’t impact your credit rating. However, missed payments can — and they could stay on your credit file for up to six years. If these persist, you might end up in mortgage arrears, leading to court action and even repossession.’  Double-check the current deal ‘Double-check when your current deal is coming to an end. If you don’t lock in a new one beforehand, you might be in for a shock when your lender puts you on the Standard Variable Rate (SVR) which can sometimes be the most expensive around. Even if you’re not looking to lock in a new deal, you can at least budget for the new repayments when your current one comes to an end.’ Contact an independent broker ‘If your current deal is coming to an end then contact an independent mortgage broker who’ll be able to provide you with sound, personalised advice on what your options are.’ Overpay (if you can) ‘Lenders will usually let you make mortgage overpayments of around 10% per year, meaning you can reduce the amount you owe and at a lower rate, saving money on interest, and reducing the term of your agreement. The savings can be substantial, so if you can afford to, or if you’re sitting on savings, do the calculations and see if you’d be better off.’ Check the credit report ‘Checking your credit report is free to do, and will show you the information banks use when choosing who to lend money to. If you spot any errors you can raise a dispute, and by checking your credit report you can make sure the information is correct and up to date. The best deals are usually reserved for those with the best scores.’