High interest rates will bring more hardship for households in 2024, says StepChange

StepChange Debt Charity says news from the Bank of England that interest rates remain unchanged today will be worrying for households yet to secure a new fixed-rate mortgage deal, as well as private renters who have faced the knock-on impact of high rates through unprecedented rent rises this year.

Richard Lane, Director of External Affairs at StepChange Debt Charity, said:

“With the base rate holding at 5.25% today, households are facing little respite from financial woes as we approach the new year. As the Bank of England pointed out last week, there are still many mortgaged households yet to secure a new fixed-rate deal since we first saw rates increase last year. Our latest polling has shown just how difficult the last two years has been on people’s finances, with one in four people now saying they will struggle to afford Christmas this year. Combined with the increase in energy bills from January, stubbornly high interest rates could spell further financial difficulties for both mortgage holders and renters well into 2024 and beyond.

“For anyone struggling with mortgage payments, it’s important to contact your lender as early as possible to let them know. Many lenders have signed up to the Government’s mortgage charter introduced earlier this year which allows people to make adjustments to their mortgage such as temporarily switching to interest only or reducing payments without impacting their credit score. Charities like StepChange offer free and impartial advice if you’re experiencing problem debt. Our new homeowner hub provides a one-stop-shop for mortgage-based advice and support.”