Will Mortgage Rates Continue Rising in Late 2025?
Will Mortgage Rates Continue Rising in Late 2025?
What Borrowers in Suffolk & Essex Need to Know.
Introduction Mortgage costs have become a daily concern for many households across the UK—and especially here in Suffolk and Essex. With the Bank of England recently cutting its base rate to 4%, yet lenders still pushing up fixed-rate mortgages, borrowers are understandably confused. In this guide, we’ll break down why rates are rising, what it means for you, and how to take smart action—whether you’re a first-time buyer or looking to remortgage.
1. Why Are Mortgage Rates Still Rising? You’d be forgiven for assuming that a drop in the Bank of England’s base rate would lead to cheaper mortgages. But that’s not what’s happening. The reality is, lenders price fixed-rate mortgages based on swap rates (the cost of long-term borrowing between banks)—not the base rate alone.
Recently, swap rates have surged due to global economic uncertainty and concerns over the UK’s long-term fiscal position. As a result, lenders including Barclays, Virgin Money, and HSBC have quietly increased their fixed mortgage rates—some by as much as 0.5%, even after the base rate was reduced.
2. What This Means for Borrowers If you’re on a variable or tracker mortgage, you may see a modest drop in monthly repayments—perhaps £20–£30 per month on a typical £200,000 loan.
However, if you’re one of the 350,000+ households coming off a low fixed-rate deal in late 2025, brace yourself: your monthly payments could rise by £250–£350, adding up to nearly £4,000 more annually.
And even if you still have 6–12 months left on your current deal, now is the time to start preparing. You can usually lock in a new rate up to 6 months in advance—and with prices rising, this could save you thousands over the next few years.
3. Are Lower Rates Coming Back Soon? Some economists predict further base rate cuts in 2026, but the picture remains unclear. What’s driving up swap rates isn’t the short-term interest rate—but long-term investor sentiment, inflation resilience, and risk pricing.
That means even if the Bank of England trims rates again, lenders may not pass on the savings until global markets settle. For borrowers, that means uncertainty—and a strong case for fixing a deal now, if you value stability.
4. Local Impact: Suffolk & Essex Here in East Anglia, affordability remains a key concern. Average property prices in Suffolk (£305,000) and Essex (£360,000) remain above the national average, and wage growth hasn’t kept pace with inflation. Council tax increases, higher energy bills, and food costs are all compounding pressure.
We’re seeing more clients in our area exploring options like:
Longer mortgage terms (up to 35 or 40 years)
95% and 100% LTV deals
Help from family via gifted deposits
Flexible protection plans to cover income or illness
5. What You Can Do Now Here are four smart actions you can take today:
a) Review Your Current Deal Check your current mortgage expiry date. Are there early repayment charges? Can you secure a better rate now?
b) Speak to a Mortgage Broker A whole-of-market broker (like us at Keyholder Mortgages) can find exclusive deals not available directly. We also help with affordability checks and lender criteria.
c) Consider Your Priorities Want to prioritise lower monthly payments, or pay off your loan sooner? Do you need payment flexibility or portability?
d) Get Mortgage Ready Lenders are tightening criteria. Clean up your credit file, reduce unsecured debt, and gather your documents—proof of income, bank statements, and ID.
6. Why Keyholder Mortgages? We’re based right on the Suffolk–Essex border, so we understand the local market pressures—whether you’re buying in Ipswich, Braintree, Colchester, or beyond.
With over 30 years in financial services, Lois Holder leads with clarity, care, and no-nonsense advice. We work with first-time buyers, remortgagers, landlords, and clients exploring equity release or lifetime mortgages.
Bonus: Book your free consultation via our Google Business listing and receive our exclusive Mortgage Readiness Checklist—a practical guide to help you prepare with confidence.
Conclusion While it’s tempting to “wait and see,” uncertainty in the market means proactivity is your best strategy. Whether you’re remortgaging, buying your first home, or simply want clarity, now’s the time to speak to a trusted mortgage advisor.
Let’s take the guesswork out of mortgages. At Keyholder, we help you make confident, informed decisions—without the jargon.
