Millions of UK households face £500 hike in mortgage bills starting from December

420,000 households face a £500 a month hike next year, it has been warned. A total of 4.4million households can expect to see their repayments increase as a result of rising mortgages - with some bills skyrocketing in December as we head towards Christmas.

The Bank of England warned that a total of 4.4million households can expect to see increases to their repayments over the next three years. A typical household rolling off a fixed-rate mortgage in the next two years is due to face a jump of around £146-a-month.

The Bank’s latest Financial Stability Report shows that most households have already had an increase in their mortgage costs. 31 per cent of all mortgages, equating to some 2.7 lion households, can expect to refinance on to a rate of at least 3 per cent for the first time before the end of 2027.

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Richard Lane, chief client officer at charity StepChange, said: “It’s important to note that with rates still high compared to a few years ago, many homeowners are struggling to keep on top of mortgage costs and cover all other financial commitments. What’s more, with inflation above the 2% target, there’s no guarantee rates will continue to fall as quickly.

“We’ve seen the amount of mortgage arrears creep up among our own clients this year and it’s a real concern that there could be many more people out there just on the edge of falling behind with payments. For anyone struggling with ongoing mortgage payments or worried about debt – don’t hesitate to reach out to your creditors and ask for help.

“Mortgage lenders have a regulatory responsibility to support borrowers who’re struggling and may be able to provide forbearance.” Officials wrote: “Following elections in many countries, a range of macroeconomic and financial policies may change under newly-elected governments.”

In a survey of finance firms like banks and asset managers, “the proportion of those citing geopolitical risks reached its highest level” recorded by the poll.