If you’re thinking about buying a home or remortgaging, today’s Bank of England announcement is worth understanding properly.

Here’s what happened, what it means, and what you can do next.

🏦 What Did the Bank of England Decide?

All nine members of the Monetary Policy Committee (MPC) voted unanimously to hold interest rates at 3.75%. It’s the first time every member has voted the same way since September 2021.

The reason? The ongoing conflict in the Middle East.

Governor Andrew Bailey explained that rising global energy prices, already visible at the petrol pump, are pushing inflation in the wrong direction. The Bank now expects CPI inflation to sit at around 3% in Q2 2026, up from the 2.1% forecast just last month in February.

If the conflict continues or escalates, inflation could reach as high as 3.5% in Q3, well above the Bank’s 2% target.

⛽ Why Does This Matter for Your Mortgage?

The impact of today’s decision depends on where you are in your homeownership journey. Here’s what it could mean for each situation — though as always, your individual circumstances will determine exactly how this affects you.

🏡 First-Time Buyers

If you’re working towards your first home, the most important thing to understand is that mortgage rates are influenced by expectations of where the Bank Rate is heading, not just where it sits today.

With several MPC members signalling that rate cuts are less likely in the near term, and a small number even flagging the possibility of a rise if the conflict worsens, some lenders have already started withdrawing deals or increasing the rates they offer.

That doesn’t mean buying is out of reach. But it does mean that getting clarity on what you can borrow sooner rather than later could save you from being caught out by further rate movements. An Agreement in Principle costs nothing, takes around 10 minutes, and gives you a realistic picture of your options based on your actual circumstances.

🔒 Current Mortgage Holders on a Fixed Rate

If you’re currently on a fixed rate, the good news is that today’s decision won’t change your monthly payments, your rate is locked in for the duration of your fixed term.

However, if your fixed rate is due to end in the next 6–12 months, now is a sensible time to start exploring your options. Mortgage offers can typically be secured in advance, which means you could lock in a deal now while they remain available, before any further market changes take effect.

We’d recommend speaking to a qualified mortgage adviser well ahead of your renewal date to understand what’s likely to be available when the time comes.

📈 Current Mortgage Holders on a Variable Rate

If you’re currently on a tracker mortgage or your lender’s standard variable rate (SVR), your payments are more directly linked to the Bank Rate.

Today’s hold means your payments are unlikely to change immediately. However, if the Bank Rate were to rise in response to a more severe or prolonged energy price shock, as some MPC members have flagged as a possibility, your monthly payments could increase.

If you’re on a variable rate and concerned about potential rises, it may be worth exploring whether switching to a fixed rate product makes sense for your situation. This is a conversation best had with a qualified mortgage adviser who can assess your full circumstances before recommending anything.

🏡 What Should You Do Next?

Whatever your situation, the most useful thing you can do right now is understand exactly what your options look like, based on your own income, deposit, and circumstances.

An Agreement in Principle (AIP) is a helpful first step for buyers. It gives you an indication of what a lender may be willing to lend, subject to full underwriting and affordability assessment. It takes around 10 minutes to complete and does not affect your credit score, and we’ll get back to you within 24 hours.

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Terms and conditions apply. This post is for information purposes only and does not constitute financial advice.