From a BBC article published on 20 March 2025 by Business reporter Michael Race, we learn about a homeowner called Louise. Louise locked in a mortgage rate of 1.8% five years ago, making homeownership manageable and predictable. Now, with her fixed rate expiring soon, she faces a stark reality: interest rates have risen significantly, and she’s looking at a potential jump to 4.5% or more. This shift means higher monthly payments, increased financial pressure, and uncertainty about what’s next.

She’s not alone. Thousands of homeowners across the UK are seeing their ultra-low mortgage deals come to an end, stepping into a market where borrowing costs have more than doubled. In the past year alone, mortgage and rental payments have surged by a staggering £19.8 billion, straining household budgets nationwide. The Bank of England, in an effort to stabilize the economy, has brought the base rate down from 5% to 4.5%, but for many, this still feels like a financial shock.

How to Survive the Mortgage Rate Shock & Stay in Control

Navigating this transition doesn’t have to mean financial distress. Here’s how you can prepare and stay in control of your mortgage payments:

1. Review Your Budget Immediately

Your monthly payments will likely increase significantly. Assess your finances now:

• List your essential expenses and identify areas to cut back.
• Consider overpaying on your current mortgage (if possible) to reduce future interest costs.
• Build an emergency fund to cushion any financial strain.

2. Secure a New Deal Early

Even if your mortgage deal doesn’t expire for several months, locking in a rate now could save you thousands.

• Lenders allow you to secure a new deal up to six months in advance.
• Interest rates are still fluctuating—waiting could cost you more in the long run.

3. Explore All Mortgage Options

• Fixed-Rate Mortgages: Provide stability but might not be the cheapest option long term.
• Tracker Mortgages: Move with the base rate, potentially offering savings if rates fall.
• Interest-Only Mortgages: Reduce monthly costs but require a solid repayment plan.
• Extending Your Mortgage Term: Spreads payments over more years, lowering monthly costs but increasing overall interest paid.

4. Speak to a Mortgage Advisor Now

Seeking professional guidance can make all the difference.

• Advisors have access to exclusive rates and lender insights.
• They help structure a deal that best suits your financial goals and risk tolerance.
• Getting expert advice early ensures you make the most informed decision.

5. Consider Additional Income Sources

If your new mortgage payments feel overwhelming, supplementing your income can provide relief.

• Rent out a spare room (tax-free up to £7,500 under the Rent-a-Room Scheme).
• Take on freelance work or a side hustle.
• Check eligibility for government support programs or tax reliefs.

6. Prepare for Future Interest Rate Changes

• Keep an eye on economic forecasts.
• Stay flexible—if rates fall, remortgaging again may be an option.
• Reassess your mortgage regularly to ensure you’re on the best deal available.

Take Control of Your Mortgage Future

Waiting until your mortgage rate expires could leave you with fewer options and higher costs. Instead, take control now. Consulting a mortgage advisor ahead of time ensures you’re prepared for what’s next, allowing you to explore the best possible deals and reduce financial stress. Whether you’re facing a rate increase or simply want to know your options, speaking with an expert today can provide clarity and confidence for the road ahead.