Understanding the Impact of Interest Rate Changes on Your Mortgage

Interest rates are a hot topic for homeowners, as even small changes can significantly affect
monthly payments. Here’s what you need to know:

What Are Interest Rates?

The Bank of England sets the base interest rate, influencing mortgage rates across the country.
Rates can either rise, fall, or stay steady.

How Do Rate Changes Affect Mortgages?
Fixed-Rate Mortgages: Your payments remain stable, regardless of rate changes.
Tracker and Variable Mortgages: Payments increase or decrease with rate changes.

Example: A £200,000 Mortgage

• At 3% interest: Monthly payment = £948
• At 5% interest: Monthly payment = £1074

Tips to Protect Yourself

• Consider fixing your rate during times of uncertainty.
• Overpay your mortgage (if allowed) to reduce the overall interest.
• Seek advice from the Purple Patch team to explore your options and make informed decisions.Prepare documents such as payslips, bank statements, and proof of ID. Once approved, you’re ready to move forward with your purchase!