More than 2.3 million households in the United Kingdom face the prospect of significantly higher mortgage payments when their fixed-rate deals expire in 2027, as the Bank of England prepares an interest-rate decision markets widely expect to raise borrowing costs. The warning, reported on 2 November from UK Finance data, comes as households face elevated energy and food costs.

An expectation, not yet a decision

The Bank of England's nine-member Monetary Policy Committee is widely expected to increase the base rate from 3.75% to 4% on 5 November, after UK inflation rose to 3.5% in September. That rise has not happened yet: the committee meets on Thursday and will publish updated inflation and growth forecasts alongside its decision. Financial markets are pricing in the possibility of four quarter-point increases over the following twelve months.

Who is affected, and when

Around 700,000 households are expected to move onto new mortgage deals between July and December 2026, while a further 2.3 million households are due to reach the end of their fixed-rate periods during 2027, according to UK Finance data cited in the reporting. Data released last week showed mortgage approvals fell to around 53,400 in September, near a three-year low, as potential buyers were put off by the jump in borrowing costs.

The wider squeeze

The Office for Budget Responsibility has warned household disposable incomes would fall by 0.6% next year after inflation, driven in part by the energy price shock. The Bank has kept its base rate unchanged since December last year, and its cautious approach since the inflation shock began will be tested by Thursday's decision and the forecasts that come with it.

Sources: The Guardian via World Right Now, 2 November 2026; CPA UK Business News Today, 2 November 2026; UK Finance data via The Guardian.