Base Rate Rise to 4%: What It Means for Your Mortgage

The Bank of England raised its base rate from 3.75% to 4% on 5 November 2026. It is the first increase since August 2023, and it changes the picture for anyone on a tracker, a standard variable rate (SVR) or a fixed deal that is about to end.

This guide explains what happened, who is affected first, and when remortgaging is worth considering. It is written to be read quickly, with the key facts first and the detail underneath.

Quick Answer

The Bank of England raised Bank Rate by 0.25 percentage points, from 3.75% to 4%, on 5 November 2026. Tracker and SVR borrowers are likely to see payments rise, typically by about £21 per £150,000 borrowed (25-year repayment mortgage, illustrative). Fixed-rate borrowers see no change to payments until the deal ends.

The key facts at a glance

• What happened: The Bank of England raised Bank Rate by 0.25 percentage points, from 3.75% to 4%, on 5 November 2026.
• The vote: 8 members backed a 0.25 point rise. 1 member voted for 0.5 points (to 4.25%).
• Why: Higher energy prices are feeding into inflation, and the Bank wants to stop that becoming embedded.
• Tracker and SVR borrowers: Monthly payments are likely to rise, typically by about £21 per £150,000 borrowed (25-year repayment mortgage, illustrative).
• Fixed-rate borrowers: No change to payments until the deal ends. Fixed rates were already rising before the decision and sit at a three-year high.
• Next decision: 17 December 2026. The Bank has said the next move "could be up, down, or sideways".
• Action: Homeowners with a deal ending in the next six months, or on an SVR, should review remortgage options now. OMF can help (see below).

What Did the Bank of England Decide on 5 November 2026?

The Monetary Policy Committee (MPC) voted 8-1 to raise Bank Rate to 4%. Bank Rate had been 3.75% since December 2025 and was held at that level at every meeting until November.

Key facts:

• Previous rate: 3.75%
• New rate: 4%
• Size of rise: 0.25 percentage points
• Vote split: 8 for 4%, 1 for 4.25%
• Previous meeting (17 September 2026): Held at 3.75%, with three members already voting for a rise
• Last increase before this one: August 2023

Why Did the Bank of England Raise Interest Rates?

The main driver is energy. Governor Andrew Bailey said there is now enough inflationary pressure in the pipeline from higher energy prices to justify a rise.

Reported figures from the MPC's November summary:

• Brent crude averaged around $108 a barrel, about 38% above the Bank's July assumption.
• UK gas prices were about 81% higher than assumed in July.
• UK inflation was 3.5% in September, against a 2% target.

The Bank's concern is "second-round effects": higher energy costs pushing up wages and prices more widely. A rise now is intended as insurance against that.

How Does the Base Rate Rise Affect Different Mortgages?

The effect depends on the type of mortgage. Trackers and SVRs react first. Fixed rates react later, at the end of the deal.

• Tracker: Rate rises by the 0.25 point increase, usually within weeks. Check the lender's notice period and compare fixed alternatives.
• Standard variable rate (SVR): Likely to rise, at the lender's discretion. SVRs are usually higher than market deals, so remortgaging often saves money.
• Fixed rate (existing deal): No change until the fixed period ends. Plan the next deal in advance.
• New fixed rate (remortgage or purchase): Pricing had already risen before the decision. Rates may stay elevated while inflation risks remain.

What Does a 0.25 Point Rise Cost in Pounds?

The figures below show the extra monthly cost of a 0.25 percentage point rise on a repayment mortgage over 25 years, moving from 4.5% to 4.75%. They are illustrations, not quotes.

• £150,000: £21
• £250,000: £36
• £400,000: £57

Further rises would add to these amounts.

Why Fixed Rates Have Not Jumped Overnight

Lenders price fixed deals using expectations of future rates, not the current base rate alone. The rise was widely expected, so much of it was already in fixed pricing. Benchmark two-year mortgage rates had climbed by nearly 50 basis points since the start of September, according to figures cited in the Bank's market commentary.

Mortgage brokers have said they do not expect a sudden spike in fixed rates now. They also warn that homeowners coming off cheaper fixed deals in the coming months may still face higher payments.

What Happens to Interest Rates Next?

No one knows, and the Bank has said so. Governor Bailey said further tightening depends on whether energy price pressure continues and whether it spreads into wages, prices and expectations, particularly through the 2027 pay round.

What forecasters currently expect:

• Deutsche Bank: One more rise, to 4.25%, in December or February.
• Bank of England Market Participants Survey: A median expected path of 4% in November and 4.25% in February.
• Next MPC decision: 17 December 2026.

Forecasts change quickly with energy prices and inflation data. Homeowners should treat them as a guide, not a promise.

Should You Remortgage After the Base Rate Rise?

Remortgaging means switching your mortgage to a new deal, either with your current lender (a product transfer) or with a new one. It is worth reviewing in these situations:

• Your fixed deal ends within six months. Many lenders let borrowers secure a new rate several months ahead of time, which protects against further rises.
• You are on your lender's SVR. SVRs are typically higher than the best available deals.
• You are on a tracker and want certainty. A fixed deal removes exposure to future base rate rises.
• Your circumstances have changed. A change in income, property value or loan-to-value can open up different rates.

Costs to check before switching:

• Early repayment charges on your current deal
• Arrangement and valuation fees
• Legal fees (some deals include free legal work)
• The overall cost across the full deal period, not only the headline rate

How to Remortgage in Five Steps

• Step 1: Check when your current deal ends and whether early repayment charges apply.
• Step 2: Gather your balance, property value, income details and recent bank statements.
• Step 3: Compare fixed, tracker and fee options across the market.
• Step 4: Secure a rate, then complete the application and valuation.
• Step 5: Switch on the agreed date, ideally the day your current deal ends.

Talk to OMF About Remortgaging

Rates are moving, and the cost of waiting can add up. OMF helps homeowners understand where they stand and what their options are.

OMF can help you to:

• Review your current mortgage and see how the 4% base rate affects your payments
• Compare remortgage options before your deal ends
• Understand the full costs of switching, not only the headline rate

Next step: Visit globalomf.com to request a remortgage review. Contact OMF

Summary

• The Bank of England raised Bank Rate to 4% on 5 November 2026, an 8-1 vote and the first rise since August 2023.
• Higher energy prices and 3.5% inflation drove the decision.
• Tracker and SVR borrowers feel the change first, at roughly £21 extra per month per £150,000 borrowed.
• Fixed-rate borrowers are protected until their deal ends, but fixed rates are at a three-year high.
• Further rises are possible but not certain. The next decision is on 17 December 2026.
• Homeowners with a deal ending soon, or on an SVR, should review remortgage options now. OMF can help.

Sources: Bank of England MPC decision of 5 November 2026; House of Commons Library; Reuters; Mortgage Solutions; MoneyWeek. Payment illustrations are OMF calculations and are not a quote. This article is general information and not personal financial advice.