The government has been urged on Monday to “end this mortgage horror show” as the average fixed two year rate has hit more than 6%.
The Lib Dems have said that it will be a “disaster for struggling families” if the government does not intervene as mortgage offers has now hit 6.01%.
However, a mortgage broker has warned that if the government does help struggling families then renters will also “be asking for the same.”
Liberal Democrat leader Ed Davey said: “The time for the Government to step in is now, anything else will be a disaster for struggling families worried about losing their homes.
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“This Government is sitting on their hands, giving no help to ordinary working people who suffer. It’s just plain wrong.
“Liberal Democrats are calling on Rishi Sunak to finally listen to those who need help and immediately end this mortgage horror show with a mortgage protection fund.”
David Linden, SNP social justice spokesperson, said: “The UK Government must take urgent action to protect people at risk of losing their homes – and to bring inflation and mortgage rates back down to manageable levels but independence in Europe is the only credible way for Scotland to secure sustained economic growth and reverse the damage being caused by Brexit.”
However, Jamie Lennox, director at Dimora Mortgages, said: “If the Government starts to help mortgage holders, tenants will also be asking for the same and it would be a case of where does it end? With many experiencing large increases in rent, there would be public outcry if support wasn’t offered further.”
The Prime Minister’s official spokesman said he was “not aware of any plans” for further interventions despite rising rates, pointing instead to cost-of-living measures already introduced, such as help with energy bills.
On help for mortgage holders, the spokesman said: “The Chancellor met with lenders in December, they agreed to support borrowers including through potential options such as term extensions, moving to interest-only payments where appropriate.
“The FCA (Financial Conduct Authority) has a new consumer duty which comes into force at the end of next month which is a step change on how firms are required to focus on delivering good outcomes for consumers.
“And of course there is Government support as well – the support for mortgage interest scheme – for struggling borrowers on certain benefits, we offer a loan to help people pay the interest on their mortgage.
“So there is a raft of support available but underpinning all of that is the fact that the biggest action the Government can do is to halve inflation.”
Speaking to ITV’s Good Morning Britain, Prime Minister Rishi Sunak said, “I know the anxiety people will have about the mortgage rates, that is why the first priority I set out at the beginning of the year was to halve inflation because that is the best and most important way that we can keep costs and interest rates down for people.
“We’ve got a clear plan to do that, it is delivering, we need to stick to the plan.
“But there is also support available for people. We have the mortgage guarantee scheme for first-time buyers and we have the support for mortgage interest scheme, which is there to help people as well.
“But look, that is why my first priority is to halve inflation, one of my other priorities is to cut the waiting lists.”
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