17,560 mortgage borrowers in Guildford set to be hit with bill rise after “shambolic budget”

Liberal Democrat Parliamentary Candidate Zöe Franklin for Guildford and Cranleigh has blamed the Government's mini-budget for the predicted rise in interest rates.

Following the chancellor's budget, 17,560 mortgage borrowers in Guildford are expected to be hit by a "monster" mortgage rate over the coming months, new analysis by the Liberal Democrats has revealed.

Nearly 30% of homes in Guildford are owned with a mortgage, above the national average of 28%.

The fallout from last week's budget is predicted to force the Bank of England to raise interest rates to as much as 5% next year, costing the average mortgage borrower on a Standard Variable Rate a staggering £2,100 per year. Those on an average tracker mortgage would face an even higher annual increase of £3,000 per year if interest rates rise to the predicted 5% next year. This would more than wipe out the government's assistance on energy bills for average households. All of this comes on top of inflation running at levels not seen in 40 years.

The Liberal Democrats are calling on Liz Truss to recall Parliament and amend the budget which has crashed the pound and seen the national debt skyrocket, as well as leading to predicted rises in mortgage interest rates.

Liberal Democrat Parliamentary Candidate for Guildford and Cranleigh, Zöe Franklin said:

"Local homeowners have been betrayed by an out-of-touch Conservative Government. In her first budget as Prime Minister, Liz Truss has chosen unfunded tax cuts for the already very wealthy, which have sent the financial markets into turmoil. It is now mortgage payers in Guildford who are left to pick up the tab. The country is sick of Conservative governments lurching from one crisis to another.

"People on the doorstep are telling me that they are really frightened by this upcoming interest rate rise. Many simply don't know how they'll afford to pay thousands of pounds more a year, especially in the midst of a cost of living crisis.

"Liz Truss owes local people an apology for this shambolic budget. Parliament must be recalled to fix this budget before it's too late. This government's experiment has clearly failed, and people in Guildford and across the country are paying the price."

Further Information

A full list of the number of homes owned with a mortgage by local authorities can be found here. Figures sourced from the latest ONS sub-national statistics for mortgages available here: Subnational estimates of dwellings and households by tenure, England: 2020

Table 1b - Counts of dwelling stock by tenure in each local authority (excluding confidence intervals), England, 2012 to 2020

According to UK Finance, a 0.25 percentage point rise in rates would result in an additional £25.76-a-month mortgage payment for an average tracker rate customer, and £15.96 for a typical borrower on a Standard Variable Rate loan.

This suggests that if the Bank of England raises interest rates to 5%, up from the current 2.25%, tracker customers will see an additional £283 a month, whilst SVR borrowers will get hit with an extra £175 a month (£2,106 per year)

Hit to typical SVR (Standard Variable Rate) and tracker mortgage if BoE interest rate reaches 5% - compared to its current level of 2.25%