One million more UK homeowners set to face higher mortgages

Image source, Getty Images By Kevin Peachey Cost of living correspondent Published 7 July 2026, 11:30 BST Updated 2 minutes ago The impact of the Iran war means a million more homeowners face higher mortgage bills than the Bank of England had previously expected. Just over five million homeowners should expect their monthly mortgage repayments to increase by the end of 2028, according to Bank forecasts. That compared to four million projected by the Bank in December. However, the Bank's Financial Stability Report said the hit would not be as hard as seen in recent years. A typical owner-occupier rolling off a fixed rate in the next two years is likely to face an increase of £45 on their monthly mortgage bill, the Bank said. That compares to a typical rise of £120 for those getting a new deal between the end of 2022 and end of 2024. However, 750,000 homeowners who are paying less than 3% interest on their current deal would be rolling off these products this year and would see an average increase of £170 per month in repayments, the Bank said. More than eight in 10 mortgage customers have fixed-rate deals. The interest rate on this kind of mortgage does not change until the deal expires, usually after two or five years, and a new one is chosen to replace it. More than two million borrowers on a two-year fixed deal expiring by the end of 2028 were projected to remortgage close to their existing rate and see little change in repayments, the Bank said. However, these borrowers were now unlikely to see repayments fall over coming years, as had been forecast prior to the Iran conflict. A modern browser with JavaScript and a stable internet connection is required to view this interactive. How much could my mortgage payments change? At this rate, your payments could change by… monthly change to monthly total The information you provided on your monthly payments would not be sufficient to pay off your mortgage within the number of years given. This calculator does not constitute financial advice. It is based on a standard mortgage repayment formula dependent on the mortgage size and length and a fixed interest rate. It should be used as a guide only and does not represent the suitability, eligibility or availability of mortgage offers for users. For exact figures, users will need to approach an official mortgage lender. Interest rates fluctuate based on the Bank of England's base rate and market conditions The Bank's report , external also says that lower income households, including renters, are likely to be more exposed to higher energy prices. "They spend a larger share of their income on essentials, limiting their ability to adjust spending in response to higher prices," it said. Homes harder to sell as high mortgage rates frustrate buyers Published 7 days ago Mortgages, jobs and energy bills - how the Iran war will affect your money Published 1 May US says it has agreed to 'stand down' after exchange of strikes with Iran Published 29 June Howeve