Average new mortgage bills rise by more than £500 a month following mini budget and Labor claim

Sign up for Inside Politics email for your briefing free daily on the biggest stories in British politicsGet our free Inside Politics emailPlease enter a valid email addressPlease enter a valid email addressI would like to be notified by email about offers, events and updates from The Independent. Read our privacy notice{{ #verifyErrors }}{{ message }}{{ /verifyErrors }}{{ ^verifyErrors }}An error has occurred. Please try again later{{ /verifyErrors }}

Families who renegotiated their mortgage in the weeks following former Chancellor Kwasi Kwarteng's mini budget will on average pay over £500 more on their monthly bills due to higher interest rates, said.

Interest rates soared following the September 23 announcement of £45 billion in unfunded tax giveaways aimed primarily at the wealthy, most of which was canceled in the following weeks by Prime Minister Liz Truss and new Chancellor Jeremy Hunt.

But the Labor Party said that during the period preceding the U-turns, approximately 113,000 households will have had to remortgage their homes at disadvantageous prices as their fixed rate contracts were up for renewal.< /p>

Party analysis found that households switching to a average mortgage deal on the day Ms Truss announced who resigned last Thursday will pay £537 a month more than the previous year.

They face a total of £13,000 in additional co-payments over two years, compared to previous years , said Shadow Leveling Secretary Lisa Nandy.

While some of the interest rate hikes imposed by the Bank of England were the result of difficult global economic conditions in the wake of Covid and the war in Ukraine, Ms Nandy said part of the rise could be blamed on the Conservatives' mismanagement of the economy.

On Thursday, when Ms Truss announced she would step down, monthly interest rates for two-year fixed-term mortgages stood at 6.65%, down from 2.25% on October 22, 2021.

Meanwhile, the 23-day delay before Mr Hunt canceled much of the mini-budget meant an estimated 113,000 people were forced to mortgage again during a time of economic turmoil.

Ms Nandy said: 'This is a Tory crisis, created in Downing Street and paid for by working people. Tens of thousands of households will be paying higher mortgage bills in the years to come because the Tories have brought the economy down.

“Despite the U-turns, the damage is done. Even now, families are paying even more because the government has lost all credibility.

"The Conservatives simply cannot trust the economy. Only Labor offers the leadership and the ideas to get Britain out of this me...