Martin Lewis has issued a warning to everyone with a mortgage ahead of a hike in interest rates today.

Interest rates are likely to increase by 0.75 percentage points from 1.75 per cent to 2.5 per cent when the Monetary Policy Committee (MPC) meet today.

It would be the highest interest rate that the UK has had since the financial crisis. In December 2008, the base rate was slashed from 3 per cent to 2 per cent.

It would also be the highest single increase to interest rates since 1989.

MoneySavingExpert Martin Lewis has warned homeowners with a mortgage that the rise could see them paying an extra £40 a month.

Lancashire Telegraph: ITVITV (Image: PA)

Mr Lewis was appearing on Good Morning Britain on Wednesday when he was asked if there was hope the situation could improve for those with a mortgage.

He said: “There is very very little hope interest rates could fall.

“The current UK interest rate is 1.75 per cent, that is likely to be going up to about 2.25 per cent or 2.5 per cent. It will add around £40 per month per £100,000 outstanding on your mortgage.

“We are hearing interest rates could rise even higher in the next year.”

The decision to hike interest rates is a bid to keep inflation under control. It is the best tool that the Bank of England has to steer inflation – currently at 9.9 per cent – back to its 2 per cent target.

But the decisions will also have major impacts on people’s finances, not least those with mortgages who will need to start paying more for their home loans.