Mortgage costs expected to rise this year, says Bank of England

The Bank of England’s quarterly Credit Conditions Survey revealed that UK lenders predicted a further widening in mortgage lending spreads in the three months to the end of February.

The banks also admitted they were expecting more UK households to default on their loans amid the cost of living crisis. The survey said the default rate remained unchanged in the last three months of 2022 but “was expected to increase in Q1”, meaning December through the end of February.

Mike Staton, director of Mansfield-based mortgage broker, Staton Mortgages, said: Mortgage pricing became frankly ridiculous in the run-up to Christmas. It was as if Ebenezer Scrooge was setting the prices. We are already seeing a rise in the number of borrowers who have missed their latest mortgage payments.

"The past three years have been painfully hard on people’s finances anyway and soaring inflation and rising rates following the mini-Budget were the straw that broke the camel’s back. As a result it’s no surprise lenders expect the number of people defaulting on both secured and unsecured loans to rise in the months ahead.”

Read more at Yahoo Finance