Mortgages during the cost of
What is the
The cost of living in the UK in 2022 is rising dramatically! Rising
inflation and proposed tax increases will hit consumers budgets. With
costs increasing and wages not matching this will cause problems for
Significant rises in the cost of living are also important to first time
home buyers and those looking to move or remortgage, as it will
mean changes to their ability to afford a mortgage.
In some cases your mortgage payments may not have risen a lot,
but combined with the other cost of living increases and lack of
wage increases this can put a strain on finances.
What is an
Whenever you apply for a mortgage an affordability assessment is
completed by the lender, this is a series of checks that the mortgage
lender carries our to ensure that you can afford the mortgage you
intend to take out.
Lenders are tightening their lending criteria to reflect increasing
costs, which has result in a reduction in the number of loans on
When a lender assess a buyers income they will need to confirm
that the borrower’s income exceeds their outgoings. With high
inflation and tax rises, this means that borrowers will be able to
afford less, which will affect the amount they can borrow.
If you can increase your deposit will help to lower the amount
borrowed and your monthly costs. If you are a first time buyer you
may be able to boost your deposit with the Help To Buy Scheme but
this is due to be phased soon. For others it means finding other
ways of trying to boost your deposit, possibly with the help of
If you already have a mortgage you may wish to consider taking
advice on whether a remortgage will help you save move and give
you the reassurance of a fixed rate in these uncertain times.
If the new monthly costs are increasing beyond your means you
could consider extending your mortgage term, or switching to an