Cost of living: Couple narrowly beat mortgage rates rise – BBC

First-time house buyers who got a mortgage just weeks before interest rates shot up have said buying is "scary" at the moment.
Morgan Luff, 23, and Ewan Anderson, 27, are buying a house in Caldicot, Monmouthshire.
They secured a 3.6% interest rate mortgage, but the average rate has now gone above 6%.
A building society boss said market volatility is likely to lead to financial difficulty for more people.
Morgan and Ewan said they were "lucky" to get a five-year mortgage deal in August.
They are now in the process of buying the semi-detached house they rent from family.
"It seems we're at the start of these new rates, where down the line it's going to be almost double by the sounds of it," Ewan said.
Morgan said the majority of the couple's friends are renting at the moment.
"We know friends that are not even looking to buy at the moment and just continue renting because it is almost cheaper," she said, "especially if you've got a fixed rent price."
Morgan said she does worry about taking on such a large commitment when things are so uncertain.
"With bills, they're going up all the time so you might be able to afford that but you don't know if you're going to afford everything in between," she explained. "It's a massive jump and being so young I don't think you really learn any of this when you're growing up."
She said the process of becoming a home owner was a "massive eye-opener".
"Five years is a very long time whereas with renting you can just walk away when your six months or your 12 months are up," she said. "It's very scary."
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"It feels lucky to have got the mortgage accepted"
As borrowing costs rise, "things will become tighter" for borrowers, said Will Carroll of Monmouthshire Building Society.
The lender was among those to withdraw some fixed-rate mortgage products after the UK government's mini-budget.
"I think it is inevitable, with a cost of living crisis and costs increasing across the board for households, that things will become tighter," Mr Carroll said.
His staff, he added, were already helping those concerned about the rising cost of repayments, or the prospect of higher rates once existing deals came to an end.
"But as a responsible lender, when we issue a mortgage we do stress an increase in future rates on an individual's ability to pay," Mr Carroll added.
"So while we do expect an increase in those members experiencing financial difficulty, we hope that it is not going to be too severe and that we can manage through until things maybe return to more normal circumstances," he said.
Rates for two and five-year fixed-term mortgages had begun climbing before the mini-budget.
Data from Moneyfacts showed average fixed rates a year ago, in October 2021, were 2.25% for a two-year fixed rate and 2.55% for a five-year fixed rate.
But by 6 October 2022 the interest rates had increased to 6.11% for a two-year deal and 6.02% for a five-year deal.
Former rugby player Mike Powell has been a mortgage broker in Caldicot since 2013.
The last month has been the busiest he has experienced, he said. Things were "chaotic, manic, turbulent, extremely busy," he explained.
"We try and take the stress away from clients but at times when lenders are pulling deals with very little notice, it's difficult."
"We've got people who have been on tracker rates for 10, 12, 15 years who've never done anything," he said. "They've seen their mortgage payments at an affordable cost to them so they've just thought it's not been going up.
He said he hears from lenders regularly and there is no sense of panic from industry insiders.
"The banks have got a lot more money this time. They're a lot more liquid than what they were in 2008 so I can't see a crash coming."
Monmouthshire Building Society withdrew fixed-rate products for new customers in the volatile period after the mini-budget, but it honoured existing applications and kept offering fixed-rate deals to existing customers.
It expected to reintroduce fixed-rate products to new customers soon, but at a higher rate than before the mini-budget.
Monmouthshire Building Society has 10,000 mortgage customers and lends about £350m a year.
Speaking at the society's Newport headquarters, Mr Carroll said his team had to adapt quickly to the market reaction after the mini-budget.
Mr Carroll said: "The Bank of England rate is at its highest level now since 2008 and the expectation is that the rate will increase further over the next year.
"I think the markets are forecasting a rate of 5.5% by the middle of next year. So we can expect an increase in the cost of borrowing as we move forward.
"We are seeing our borrowing members come to us sooner than maybe they had done previously with concerns about that increased cost of borrowing into the future."
He encouraged borrowers with concerns to contact the building society's mortgage advisers.
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