Hundreds of thousands of households risk paying an extra £1,700 a year on their mortgages as a wave of cheap fixed-rate deals struck five years ago end.

Analysts are bracing for a rush of remortgaging as homeowners try to beat interest rate rises and loans taken out in 2018 come up for renewal.

However, those remortgaging will face a jump in monthly repayments as markets brace for the Bank of England to raise rates to more than 2pc in a bid to curb inflation. 

Almost 600,000 people remortgaged in 2018 ahead of an expected interest rate rise, meaning that many five-year fixed deals will be up for renewal next year.

If the Bank rate hits 2pc by 2023, as markets expect, and lenders pass on the increases, the rate on a typical five-year fix would hit 4pc, according to Moneyfacts.

Those who took a cheap five-year fixed rate mortgage on a £200,000 loan in 2018 would find their monthly repayments rising by £140 a month on a new five-year deal – a £1,680 annual blow.

Andrew Wishart, economist at Capital Economics, said the rate on a five-year fix is likely to rise by almost 1 percentage point at least.

He added: “I expect mortgage rates to rise sharply over the next few months. The steep rise in market interest rates has yet to be priced into mortgage rates so lenders have historically low margins right now.

“I expect this to be resolved by a rise in mortgage rates over the coming months.”