How Much Will My Mortgage Go Up?

Following continuous interest rate hikes at the start of the decade, we’re finally seeing a downward trend. Yet, for many homeowners thinking about remortgaging, questions still remain about how the changes will influence their monthly payments.

In this article, we’ll break down the effects of these rate changes on different mortgage types, while offering practical advice for both prospective homeowners and those planning to remortgage in 2025.

What’s happening with interest rates in 2025?

On 1 August 2024, the Bank of England’s Monetary Policy Committee (MPC) made a pivotal decision to lower the base rate to 5%. Since then, the MPC has made further cuts: to 4.75% on 7 November 2024, 4.5% on 6 February 2025, and most recently to 4.25% on 8 May 2025.

When will mortgage interest rates come down?

With the base rate cut in May, mortgage rates were widely expected by market commentators at the time to decline. Typically, when interest rates drop, mortgage rates follow a similar trend. The Bank of England’s MPC meets every six weeks to decide whether to adjust the base rate.

Why are mortgage rates fluctuating?

The fluctuations in mortgage rates are primarily driven by inflation and broader economic conditions. The MPC raises the base rate to control inflation by making borrowing more expensive, which reduces spending by consumers, households, and businesses, ultimately slowing down the economy.

Movements at the time were shaped by persistent wage growth, global economic uncertainty, and shifts in international monetary policy. When this article was written in May 2025, inflation, as measured by the Consumer Price Index (CPI), was 2.6% — close to the Bank of England’s 2% target. This is a historical figure and does not reflect inflation today.

Will my mortgage go up if interest rates rise?

If you have a variable-rate tracker mortgage, then your payments will rise. This is because a tracker mortgage is directly linked to the Bank of England base rate, so any increase in the base rate will immediately impact your interest rate and therefore your monthly payments.

On the other hand, if you have a fixed-rate mortgage, you're protected from these changes for the duration of your term. That said, it's still important to monitor interest rates, as a significant increase could lead to higher repayments once your fixed term ends and you need to refinance your mortgage.

What did interest rates at the time mean for remortgaging?

Whatever direction rates move next, many homeowners are understandably anxious about the potential rise in their payments when remortgaging from an older, lower fixed rate.

Given that fixed rates are generally higher than what they were a few years ago, it’s not surprising to expect a noticeable increase in your mortgage rate if you get a new deal. However, the specific rates you might encounter depend on various factors, including market conditions and your financial situation.

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How much will my mortgage go up?

If you're transitioning from a low-rate fixed mortgage to a higher rate, it’s important to understand how this will affect your monthly payments. Below is a comparison of what you’d pay on a 2% fixed-rate mortgage versus a 4.25% fixed-rate mortgage, based on various loan amounts over a 25-year term at 60% LTV:

For a more personalised estimate, try using our mortgage repayment calculator to see how different rates will impact your payments.

Is 2025 a good time to remortgage?

Whether now is a good time to remortgage depends on your individual circumstances. Often, the decision comes down to timing. For instance, if your current low-rate mortgage is expiring, you might face a choice between remortgaging or letting your loan switch to your lender’s standard variable rate. In this case, remortgaging could save you money in the long-term due to lower overall interest.

To make the most of your current low rate, consider making overpayments on your mortgage. Overpaying can help reduce your mortgage balance quicker, which means a lower amount to finance when you remortgage. Just be sure to review your mortgage terms to confirm that overpayments are allowed and to check for any limits or early repayment charges that could affect you.

Should I speak to a mortgage broker?

Consulting a mortgage broker is a valuable step in navigating the mortgage landscape. Brokers not only help you understand the range of options available, but also offer insights into which deals might best suit your needs, regardless of if you’re a first-time buyer or homeowner seeking a remortgage.

Specifically, they have access to exclusive deals and lenders that you may not find on your own, opening you up to receive more competitive rates and terms. This can be especially beneficial if you’re looking to maximise your savings or find a tailored solution for your unique financial position.

At The Mortgage Genie, our extensive knowledge of the mortgage market enables us to provide expert advice, helping you secure the most competitive deal for your situation with the best possible interest rates. If you're ready to explore your options, get in touch with us today at 0191 580 9890.

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The above blog has information contained within which was correct at the time of publication but is subject to change.