1 in 4 face rate rise risk
Research by The Resolution Centre found that 1 in 4 mortgages could become unaffordable following a rate rise.
And it has now called on the regulator to demand that lenders offer advice to their “at risk” borrowers.
Matthew Whittaker, chief economist at the foundation, said that a base rate rise would be an “unwelcome shock” to many and that action was needed now.
He said: “Swift action now will help to limit the fall-out in years to come and will be much more effective than waiting until a borrower falls into arrears before getting in touch.
“We can’t just assume it will all be alright on the night.”
Whittaker emphasised that the majority of the borrowers were not facing an immediate problem.
“Most people will be able to absorb one or two interest rate rises,” he said.
“We need to act now to ensure that all lenders seek out those customers who are just about keeping their heads above water in the current era of low interest rates in order to help them prepare for a future of higher repayments.
“Some lenders are already doing this, but it’s crucial that the whole industry wakes up to the need to identify and engage with these at-risk customers.”
The Resolution Centre’s full research into the issue is due out on Thursday.