{"id":1566,"date":"2022-04-11T06:36:00","date_gmt":"2022-04-11T06:36:00","guid":{"rendered":"https:\/\/wordpress-1197097-5857112.cloudwaysapps.com\/?p=1566"},"modified":"2025-11-21T09:39:07","modified_gmt":"2025-11-21T09:39:07","slug":"how-first-time-buyers-can-get-ahead-of-spiraling-interest-rates","status":"publish","type":"post","link":"https:\/\/strideup.co\/news\/knowledge\/how-first-time-buyers-can-get-ahead-of-spiraling-interest-rates\/","title":{"rendered":"How first-time buyers can navigate spiraling interest rates"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">In October, 2022 the average 2-year fixed rate mortgage exceeded 6% for the first time in 14 years. A quarter of mortgage products have been pulled by banks and building societies in recent weeks, after a fall in the pound prompted forecasts of skyrocketing <a href=\"https:\/\/www.theguardian.com\/money\/2022\/sep\/27\/uk-mortgage-deals-pulled-pound-rate-rise\" target=\"_blank\" rel=\"noopener\">interest rates<\/a>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In this blog we\u2019re here to help you understand this volatile situation and strategise your way to home ownership.<\/p>\n\n\n<section class=\"table_of_contents\">\n    <h5>Table of contents<\/h5>\n    <ul>\n        <li><a href=\"#section1\">What we heard at MTF 2025<\/a><\/li>\n        <li><a href=\"#section2\">The data confirms it: Our community is underserved<\/a><\/li>\n        <li><a href=\"#section3\">StrideUp&#8217;s model resonated deeply<\/a><\/li>\n        <li><a href=\"#section4\">More than a moment &#8211; a movement<\/a><\/li>\n        <li><a href=\"#section5\">The data confirms it: Our community is underserved<\/a><\/li>\n        <li><a href=\"#section6\">So, what\u2019s next?<\/a><\/li>\n    <\/ul>\n<\/section>\n\n\n<h2 class=\"wp-block-heading\"><strong>Is this good or bad news for first time buyers?<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Naturally, high interest rates and fewer mortgage products will make it more difficult for many first-time buyers to afford a home. It will also impact how much a buyer can afford as higher monthly repayments combined with high energy and food prices may simply price some buyers out of the market.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The table below outlines how your repayments would change if you had a \u00a3200,000 mortgage at a fixed rate over a 25 year term, based on rates increasing from between 2% to 6%.<\/p>\n\n\n\n<figure class=\"wp-block-table stretched\"><table class=\"has-fixed-layout\"><thead><tr><th class=\"has-text-align-left\" data-align=\"left\">Fixed mortgage rate (\u00a3200,000 over 25 years)<\/th><th class=\"has-text-align-left\" data-align=\"left\"><strong>Monthly payments<\/strong><\/th><th class=\"has-text-align-left\" data-align=\"left\"><strong>Increase in monthly payments<\/strong><\/th><\/tr><\/thead><tbody><tr><td class=\"has-text-align-left\" data-align=\"left\">1%<\/td><td class=\"has-text-align-left\" data-align=\"left\">\u00a3754<\/td><td class=\"has-text-align-left\" data-align=\"left\"><\/td><\/tr><tr><td class=\"has-text-align-left\" data-align=\"left\">2%<\/td><td class=\"has-text-align-left\" data-align=\"left\">\u00a3848<\/td><td class=\"has-text-align-left\" data-align=\"left\">+\u00a394<\/td><\/tr><tr><td class=\"has-text-align-left\" data-align=\"left\">3%<\/td><td class=\"has-text-align-left\" data-align=\"left\">\u00a3948<\/td><td class=\"has-text-align-left\" data-align=\"left\">+\u00a3194<\/td><\/tr><tr><td class=\"has-text-align-left\" data-align=\"left\">4%<\/td><td class=\"has-text-align-left\" data-align=\"left\">\u00a31,056<\/td><td class=\"has-text-align-left\" data-align=\"left\">+\u00a3302<\/td><\/tr><tr><td class=\"has-text-align-left\" data-align=\"left\">5%<\/td><td class=\"has-text-align-left\" data-align=\"left\">\u00a31,169<\/td><td class=\"has-text-align-left\" data-align=\"left\">+\u00a3415<\/td><\/tr><tr><td class=\"has-text-align-left\" data-align=\"left\">6%<\/td><td class=\"has-text-align-left\" data-align=\"left\">\u00a31,289<\/td><td class=\"has-text-align-left\" data-align=\"left\">+\u00a3535<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Source: <a href=\"https:\/\/www.rightmove.co.uk\/news\/articles\/property-news\/interest-rates-mortgages\/\" target=\"_blank\" rel=\"noopener\">RightMove<\/a>, September 29, 2022<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">With the historical period of low interest rates coming to an end, many homeowners are looking at monthly repayments increasing by \u00a3400-\u00a3500. However, there is a glimmer of hope. These rising interest rates could prompt landlords to sell up rather than remortgaging, which could lead to a temporary rise in the number of properties becoming available \u2013 good news for prospective buyers.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If you\u2019re in a position to buy, check out our article from last year about how to <a href=\"https:\/\/strideup.co\/blog\/house-buying-process-mistakes\">avoid common pitfalls in buying a house.<\/a><\/p>\n\n\n\n<div class=\"custom_video custom_image wp-block-video w-full h-auto tabland:rounded-[32px] relative overflow-hidden\">\n    <div class=\"image w-full h-full max-h-[600px] tabland:rounded-[32px] overflow-hidden object-cover relative\">\n        <img decoding=\"async\" class=\"w-full h-auto\" src=\"https:\/\/strideup.co\/wp-content\/uploads\/2025\/11\/6464ba1b85e9d702c4d490ee_Rate_changes_2df1e74c2d-scaled.jpg\" alt=\"StrideUp is UK's leading provider of flexible, halal home finance.\">\n    <\/div>\n    <figcaption>StrideUp is UK&#8217;s leading provider of flexible, halal home finance.<\/figcaption>\n<\/div>\n\n\n<h2 class=\"wp-block-heading\"><strong>How will this affect borrowers with poor credit?<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Homeowners with high debt levels or who may have missed repayments on credit are likely to struggle even more to find a lender who will take them on. Many of the home finance products which have been withdrawn were offered by smaller, more <a href=\"https:\/\/www.bbc.co.uk\/news\/business-63119047\" target=\"_blank\" rel=\"noopener\">specialist lenders<\/a>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If you\u2019re concerned about your chances of finding a lender, you can get some advice with our blog on <a href=\"https:\/\/strideup.co\/blog\/first-time-buyer-guide-how-to-maintain-a-good-credit-score\">how to maintain a good credit score<\/a>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">It\u2019s still possible to find lenders who are willing to offer home finance to borrowers with poor credit but there will be fewer options.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>So what can you do about it?<\/strong><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\">1. <strong>Do your research<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">If you\u2019re looking for home finance, it pays to shop around. Using price comparison websites like <a href=\"https:\/\/www.moneysavingexpert.com\/mortgages\/\" target=\"_blank\" rel=\"noopener\">Money Saving Expert<\/a> and <a href=\"https:\/\/www.comparethemarket.com\/mortgages\/\" target=\"_blank\" rel=\"noopener\">Compare the Market<\/a>, as well as reading advice from lenders will help you to find the best deals and anticipate changes such as longer-term mortgages coming on the market.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Over recent months, first-time buyers are finding that a product is pulled off the market before they have a chance to apply or even &#8211; in some cases &#8211; after they\u2019ve pursued the purchase of a property with an existing Decision in Principle.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This is due to an overwhelming number of applications and\/or lenders suspending new business to allow them time to assess the impact of market fluctuations. This is the frustrating result of the rapidly changing economic situation and the demand from homeowners trying to re-mortgage before interest rates might climb any higher. To avoid the frustration of searching yourself you might want to\u2026<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">2. <strong>Get a mortgage adviser<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">To take the stress out of finding the best mortgage for you, you can hire a mortgage adviser to find the best options and liaise with the lenders. Some mortgage brokers even offer their services for free as they get paid a fee by the mortgage lender instead.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If your chosen broker does have a fee, you can expect to pay \u00a3300-\u00a3600 for the service, with the average cost in the UK currently sitting at \u00a3500, according to the <a href=\"https:\/\/boonbrokers.co.uk\/mortgage-broker-costs\/\" target=\"_blank\" rel=\"noopener\">Money Advice Service<\/a>. However, the cost of the service varies depending on where you are based, the complexity of your situation and whether you opt for a fixed fee, percentage, or hourly rate (a fixed fee is usually cheaper overall).<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">It\u2019s best to choose a vetted FCA regulated mortgage professional, so you know they have the relevant expertise.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">3. <strong>Wait for better rates<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">If you\u2019re not in a hurry to buy a house, or if you\u2019ve been offered an alternative housing situation such as staying with family or moving into an affordable rental, you might decide to wait until the interest rates stabilises.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If you\u2019re lucky enough to be in this situation, you may find that the market is more positive down the line. However, by delaying your purchase you run the risk of seeing interest rates continue to rise without a significant drop in house prices, making it even harder to get on the property ladder. You can explore your options by reading our blog on the <a href=\"https:\/\/strideup.co\/blog\/rent-now-buy-later\">pros and cons of renting vs buying<\/a>.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">4. <strong>Opt for a fixed rate mortgage<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">To gain more security and peace of mind you can opt for a longer-term fixed rate mortgage. This means that if interest rates continue to climb you won\u2019t have to pay a penny more until your fixed term comes to an end.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This is an increasingly popular strategy, with lenders starting to offer 10, 15, and even 20-year fixed rate mortgage products. If peace-of-mind and predictable monthly repayments is a priority for you, StrideUp has a new 10-year fixed term product that might suit your needs that you can speak to our advisors about.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>What\u2019s the future for mortgage rates?<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The Bank of England is predicting high and rising interest rates until at least July 2023. Industry voices are expecting that the Bank of England base rate will rise to over 4% by the end of 2022 and climb to 5.5% by <a href=\"https:\/\/moneytothemasses.com\/owning-a-home\/interest-rate-forecasts\/latest-interest-rate-predictions-when-will-rates-rise\" target=\"_blank\" rel=\"noopener\">July 2023<\/a>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Mortgages that are not fixed are tied to the base rate in one of two ways: tracker mortgages are directly paired to the BoE base rate while Standard Variable Rate (SVR) mortgages are set by the lender and closely related to the base rate. This means that mortgage costs for existing SVR mortgages and new mortgage products are likely to go up considerably.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The base rate is set by the MPC, a nine-person committee within the Bank of England that decides the interest rate based on 18 economic factors. They meet every six weeks to decide if the rate will increase, decrease or stay the same. In an unprecedented move, in September the MPC increased the base rate for the seventh consecutive time to 2.25%.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In this rate environment, the key factor for first-time buyers is an understanding of the various pros and cons of different home finance products.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In response to the current trends, StrideUp has expanded its product range in order to provide more flexibility to our customers. If you\u2019d like to discuss any of our new 10 year fixed, 2 year tracker and 2 year fixed product, head over to our <a href=\"https:\/\/strideup.co\/\">main site<\/a> to chat to a team member on messenger.<\/p>\n\n\n<div class=\"special_separator flex justify-center my-8 middletab:my-14\">\n    <svg width=\"62\" height=\"12\" viewBox=\"0 0 62 12\" fill=\"none\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\">\n        <path d=\"M15.5 7.45938C15.5 3.30547 12.0854 -0.0560486 7.89524 0.000708303C3.98534 0.0537023 0.730931 3.14742 0.512121 7.03041C0.41249 8.7974 0.932401 10.4402 1.8748 11.7644C2.06429 12.0304 2.442 12.0793 2.69297 11.8695L7.19939 8.10879L7.20286 8.10691C7.41915 7.92692 7.69787 7.81874 8.0018 7.81874C8.30574 7.81874 8.59171 7.92974 8.80926 8.11381L8.81273 8.11569L13.3084 11.8673C13.5597 12.0771 13.9377 12.0275 14.1272 11.7613C14.9918 10.5456 15.5 9.06143 15.5 7.45907V7.45938Z\" fill=\"#627C84\"\/>\n        <path d=\"M38.5 7.45938C38.5 3.30547 35.0854 -0.0560486 30.8952 0.000708303C26.9853 0.0537023 23.7309 3.14742 23.5121 7.03041C23.4125 8.7974 23.9324 10.4402 24.8748 11.7644C25.0643 12.0304 25.442 12.0793 25.693 11.8695L30.1994 8.10879L30.2029 8.10691C30.4191 7.92692 30.6979 7.81874 31.0018 7.81874C31.3057 7.81874 31.5917 7.92974 31.8093 8.11381L31.8127 8.11569L36.3084 11.8673C36.5597 12.0771 36.9377 12.0275 37.1272 11.7613C37.9918 10.5456 38.5 9.06143 38.5 7.45907V7.45938Z\" fill=\"#627C84\"\/>\n        <path d=\"M61.5 7.45938C61.5 3.30547 58.0854 -0.0560486 53.8952 0.000708303C49.9853 0.0537023 46.7309 3.14742 46.5121 7.03041C46.4125 8.7974 46.9324 10.4402 47.8748 11.7644C48.0643 12.0304 48.442 12.0793 48.693 11.8695L53.1994 8.10879L53.2029 8.10691C53.4191 7.92692 53.6979 7.81874 54.0018 7.81874C54.3057 7.81874 54.5917 7.92974 54.8093 8.11381L54.8127 8.11569L59.3084 11.8673C59.5597 12.0771 59.9377 12.0275 60.1272 11.7613C60.9918 10.5456 61.5 9.06143 61.5 7.45907V7.45938Z\" fill=\"#627C84\"\/>\n    <\/svg>\n<\/div>\n\n\n<div class=\"blog_cta rounded-[24px] tabland:rounded-[32px] my-8 tabland:my-14 py-8 tabland:py-12 px-6 tabland:px-5 text-center\" style=\"background-color: #F4F4F4;\">\n    <h2 class=\"font-ttnormspro slightly-tight-letters-title text-3xl font-extrabold mb-4\" style=\"color: #20272D;\">Stay in the loop.<\/h2>\n    <div class=\"desc font-lexend text-sm text-[#6A6A6C] mb-8 leading-normal font-feature-on tight-letters-paragraph\">Join our newsletter for exclusive updates and insights you won\u2019t want to miss.<\/div>\n            <a href=\"#subscription_form\" class=\"btn w-fit mx-auto\">\n            <div class=\"text\">\n                Subscribe            <\/div>\n        <\/a>\n    <\/div>\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n","protected":false},"excerpt":{"rendered":"<p>We\u2019ve all heard about the increase in interest rates \u2013 but how will they affect first-time buyers? <\/p>\n","protected":false},"author":3,"featured_media":1567,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[103],"tags":[107,104,105,106],"post_author":[50],"class_list":["post-1566","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-knowledge","tag-home-mortgage-payments","tag-interest-rate-rises","tag-mortgage-interest-rates","tag-rising-interest-rates","post_author-team-strideup"],"_links":{"self":[{"href":"https:\/\/strideup.co\/wp-json\/wp\/v2\/posts\/1566","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/strideup.co\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/strideup.co\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/strideup.co\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/strideup.co\/wp-json\/wp\/v2\/comments?post=1566"}],"version-history":[{"count":3,"href":"https:\/\/strideup.co\/wp-json\/wp\/v2\/posts\/1566\/revisions"}],"predecessor-version":[{"id":2838,"href":"https:\/\/strideup.co\/wp-json\/wp\/v2\/posts\/1566\/revisions\/2838"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/strideup.co\/wp-json\/wp\/v2\/media\/1567"}],"wp:attachment":[{"href":"https:\/\/strideup.co\/wp-json\/wp\/v2\/media?parent=1566"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/strideup.co\/wp-json\/wp\/v2\/categories?post=1566"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/strideup.co\/wp-json\/wp\/v2\/tags?post=1566"},{"taxonomy":"post_author","embeddable":true,"href":"https:\/\/strideup.co\/wp-json\/wp\/v2\/post_author?post=1566"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}