Half of homeowners could struggle with 3% rate rise
Such a rate rise would leave homeowners on the hook for an additional £150 per month for every £100,000 owed.
According to research by Ocean Finance 38% of homeowners said they could potentially struggle under the increased financial burden, while 7.9% said they would definitely have difficulties and would need to sell their property immediately.
The Bank of England base interest rate is currently at a historic low of 0.5%, but even so one-in-ten homeowners are behind on their mortgage payments. A further 19% are up-to-date but struggling.
Ian Williams of Ocean Finance said: “Clearly it is likely to take a while for rates to rise by 3%. But if they do go up by that much over the next couple of years it’s worrying to hear that nearly half of mortgage borrowers are concerned about how they would keep up with repayments – especially when one in ten are already behind.”