How Could the UK Budget Influence Your Mortgage Rates?

Think of the Budget like the government announcing its financial game plan: how much it will spend, save, or borrow. While it doesn’t directly set mortgage rates, it can subtly nudge the economy in ways that lenders watch very closely.

How it works:

• Government borrowing can affect markets. When the government borrows more money, investors can get nervous. This may push up the cost of borrowing for everyone, including banks, which could then lead to higher mortgage rates.
  

• A steady, sensible Budget can ease pressure. If the Budget looks balanced and careful, markets may relax. Borrowing could become cheaper, and mortgage rates might drift down.
  

So, what does this mean for 2026?

• Lower rates are possible, but we aren't expecting a dramatic drop.

• More likely, we'd expect to see a slow, gradual decline rather than a sudden fall.

• And if the Budget shakes market confidence, lenders could keep rates the same or even increase them.
  

In short, the Budget shapes the conditions that influence mortgage rates- it doesn’t directly set them.

Curious about what this could mean for your mortgage?

Get in touch with us at Oof! Mortgages, and we can talk through your options.

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Disclaimer: This content is for general information purposes only and does not constitute financial advice. Mortgage interest rates can vary and are subject to change. Always speak with a qualified mortgage adviser or lender to discuss your personal circumstances.