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After the 12th consecutive raise, growing interest rates will cost UK mortgage holders £12bn in extra payments, which mostly hit young families.

In a report that emphasised the dramatic impact of higher borrowing costs, the Resolution Foundation said the Bank of England’s 12 consecutive rates rises since December 2021 had already cost homeowners £4.2bn, with about £8bn more in extra payments likely over the next couple of years.

More than 1.6 million homeowners are expected to re-finance the fixed rate loans this year, forcing them to pay an average £2,300 extra a year in interest payments.