Interest rates to rise, borrowers warned
Figures released by Lloyds Bank earlier this week showed Brits were increasingly confident in their ability to pay down loans and debts.
However, interest rates are currently at historic lows and price comparison site uSwitch has warned borrowers to expect interest rate rises.
It said consumers should make sure they can service the loan even if rates rise in future.
Borrowers were warned to be realistic with their housing aspirations to avoid long-term issues.
David Mann, head of money at uSwitch.com, said consumer borrowing was growing and confidence was rising.
“While borrowing grew by record amounts in March, people shouldn’t bite off more than they can chew,” he said.
“Low interest rates won’t last forever – consumer confidence to pay back debts needs to be combined with a realistic and actionable plan to manage repayments.
“It’s important to keep an eye on your rate and the best deals, to make sure you’re not paying over the odds. If you’ve got a great rate, a word of warning – introductory deals won’t last forever, so make sure you either have slack in your monthly budget to cover an increase or even better, plan to switch or move your debt so you don’t get caught out.”