Archive: Will the Ukrainian invasion impact my mortgage?
(written on 17th March 2022) Russia’s invasion of Ukraine is likely to have far reaching impacts. As a result, many of our customers have been asking us, will the Ukrainian invasion impact my mortgage? While none of us has a crystal ball, at Your Mortgage Expert, we make it our job to stay on top of all the market predictions. We have put together our thoughts on what might happen to the mortgage market due to the Ukrainian situation.
Will my mortgage be impacted?
Adam Nanson, Impartial Mortgage Adviser at Your Mortgage Expert comments:
“In February, the Bank of England increased the base rate to 0.5% in an attempt to curb inflation. Despite this, inflation continues to rise and the Ukrainian invasion by Russia is likely to impact the cost of living further. Most financial experts are now predicting a further interest rate rise in the near future* and say inflation is likely to stay higher for longer**.
“The impact of this will be that mortgage rates are likely to rise. And, we have already seen that the choice of mortgage products available on the market has started to reduce***.
“So if you ask will the Ukrainian invasion will impact my mortgage? The answer is probably yes. But if you are on a fixed term arrangement, you won’t feel the impact of this until you come to remortgage. When you come to remortgage your property or to mortgage a new one, your rate is likely to be higher and will cost you more.”
What should I do if I need a mortgage?
“Even though mortgages are likely to become more expensive during 2022 and 2023, even with the rate squeeze, there are still savings to be made and deals available. And, if your fixed term deal is coming to an end or you are currently on the Standard Variable Rate we would advise you to act now rather than waiting. The Bank of England is likely to increase the base rate slowly and steadily over the forthcoming year, so delaying is unlikely to be a wise move.
“In general, a fixed rate deal will save you money rather than falling onto the Standard Variable Rate. By fixing your mortgage now, it also gives you peace of mind that your monthly mortgage payment will remain the same in spite of spiralling costs of living.
“We will, of course, be watching the markets carefully. If you want the latest information and the most informed across market understanding, we would recommend you speak to an impartial mortgage broker like Your Mortgage Expert.”
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The information contained within this article was correct at the time of publication. It is intended for information only and does not constitute advice. Your Mortgage Expert Ltd and Mortgage Advice Bureau cannot be held responsible for information that was correct at the time of publication but subsequently changes or goes out of date due to changes in legislation.
*source 1 – interest rate rise expected: https://www.propertyroad.co.uk/ukraine-conflict-affect-uk-housing-market/
**source 2 – inflation like to stay higher for longer https://www.theguardian.com/business/2022/feb/25/ukraine-russia-inflation-economy-oil-gas
***source 3 – reduced range of mortgage products: https://www.mortgagestrategy.co.uk/news/mortgage-market-continues-to-tighten-moneyfacts/