The quarter-point rise in the base rate will be a serious concern for many homeowners, it has been claimed.
Yesterday saw the Bank of England's monetary policy committee decide to hike interest rates by a quarter of a percentage point, following on from an identical rise in November 2006.
And the move means that many homeowners with tracker mortgages will face increased monthly repayment charges.
"This is another rise in a short period of time that could hit some homeowners hard," commented Peter Tutton, policy officer at financial advisory organisation Citizens Advice.
"We are already seeing a rapidly growing number of people falling behind with mortgage payments and in some cases threatened with repossession."
One option open to people coming to the end of their current tracker mortgage deal is to consider switching to a fixed-rate mortgage.
Unlike trackers, fixed-rate mortgages are not affected by fluctuations in the base rate.
This means that they can potentially offer greater financing stability for those homeowners who are worried about being unable to cope with the mortgage consequences of further rate increases.
Consequences of interest rate rise spelt out for mortgage holders
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Consequences of interest rate rise spelt out for mortgage holders
Fri, 12 Jan 2007
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