New research from Bluestone Mortgages has revealed that 47% of UK mortgage holders have seen their mortgage payments increase by an average of £234 per month in the last 12 months, as the ongoing cost of living crisis and inflationary pressures continue to put a strain on household finances. This equates to £2,808 over the year.
Of these mortgage holders, younger borrowers have been hit with the greatest increases of £288 per month, compared to just £156 for those who are over 55 years old.
For those who have seen their mortgage payments increase in the last year, 52% have said this is because their fixed-rate mortgage came to an end. 40% said their payments increased as they are on a Standard Variable Rate.
Amid these affordability challenges, mortgage holders have taken a number of steps to keep up with their monthly payments. 16% of mortgage holders have been overpaying while they were on a lower rate, 7% have switched to an interest-only deal, while a further 7% have asked their lender for a mortgage holiday. Mortgage holders also admitted to borrowing money from loved ones to keep up with their payments. 9% have borrowed money from their family and 5% have borrowed from friends.
Steve Seal, CEO of Bluestone Mortgages, said: “As inflationary pressures and rising cost of living continue to squeeze the nation’s pockets, borrowers are no doubt feeling anxious about how they are going to balance increased mortgage payments with their everyday bills.
“However, there is a glimmer of hope on the horizon as following two consecutive rate holds, lenders are starting to drop their rates, which will ease affordability pressures. For those still concerned, remember that there is help at hand, whether that be opting for a product transfer, asking for a payment holiday or being signposted to specialist support. The earlier they engage, the sooner they will receive the tailored support they need for their unique circumstances to make their homeownership dream a reality.”