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29th Sep 2022

Martin Lewis fights back tears over worry mortgage increase will be ‘catastrophic’

Steve Hopkins

The money saving expert said the mortgage hike is ‘scary’ and ‘changing by the hour’

Martin Lewis teared up on breakfast TV on Thursday as he discussed how the mortgage increases could be “catastrophic” for some Brits.

The 50-year-old told Holly Willoughby and Phillip Schofield that the “incredible uncertain times” – accelerated by the government’s Mini-Budget – “would be catastrophic for many people”.

A number of lenders have temporarily halted mortgage offers for new customers and rates are being lifted. Economists now expect interest rates to more than double to 5.8 per cent by April, from the current level of 2.25 per cent. Interest rates had previously been forecast to hit 4 per cent by next May.

Lewis told viewers: “It is scary, it is uncertain and it is changing by the hour.

“I have to caveat that no one knows where we are going right now. We have yet again incredibly uncertain times.”

He added: “Interest rates are going to go up and go up severely very, very soon.

“They are predicting interest rates of nearly six per cent by next spring. That would be catastrophic for many.”

Lewis advised people with a variable or fixed rate that is “coming to an end” in the next few months to “look today to see what is available”.

He lamented: “I have sat here so many times recently and said this is unprecedented, it has been unprecedented so many times I feel like it is precedented. We seem to lurch from one turmoil to a crisis to a catastrophe and back.”

The UK’s stock and bond markets have lost at least $500 billion in combined value since Liz Truss took over as prime minister, according to Bloomberg. 

Major banks and lenders started pulling deals this week, over fears for the UK economy following the Mini-Budget. Markets are also spooked after Chancellor Kwasi Kwarteng announced the biggest tax cuts in 50 years – alongside massively increasing borrowing.

Since Friday, the cost of government borrowing has risen and the Bank of England will raise interest rates at the next meeting in November.

As a result, it will raise the cost of borrowing for both banks and building societies that offer mortgages.

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