Many people in this position are trapped on high-interest variable rate mortgages because banks will not allow them to remortgage when their fixed-rate deals come to an end.IT analyst Alex Dickin, 30, bought a one-bedroom flat in Ipswich in 2016, but is now unable to sell or remortgage, due to a litany of fire safety issues.
“I’ve got those two large outgoings and one of them is on this uncontrolled spiral constantly going up. So it is a question of when is it going to stop? When is it going to settle down? Because eventually it will get to the point where it will become unaffordable,” he said. “What else are they gong to let me live through even though back in 2016 they were happy to give me a helping hand onto the property ladder?”for people who are unable to pay their mortgages and has instead said it will put pressure on banks to be more flexible with their customers.Paul Afshar, 39, moved into his one-bedroom shared ownership flat in Tower Hamlets, east London, 15 years ago. Like Mr Dickin, he is unable to sell due to building safety issues.
“Literally, within days of the Bank of England putting its interest rate up I get a letter from Halifax saying ‘oops sorry we’ve put up your mortgage rate again – here’s the new total amount that you’ll be paying per month’. So it will go up after today…the increment isn’t huge. It’s like £40/50/60 but the cumulative effect is obviously quite big,” he said.