Homeowners 'should anticipate a rise in interest rates'

Posted: 16 Dec 2010 09:31:49 GMT

An expert has claimed more homes could be repossessed when interest rates go back up.

Homeowners need to prepare for an interest rate rise, it has been suggested.

Chris Jenkins, creative director at Dallas Matthews, said more properties could be repossessed due to a hike in the base rate and household bills.

"Lenders will tell people how much payments will increase in the event of a rate rise. Knowing the amount payments will increase by will help to plan for the long-term and stay debt free," he stated.

Individuals should not bury their head in the sand if they experience financial difficulty, they should get help, Mr Jenkins advised.

His comments follow the release of figures from the Council of Mortgage Lenders, which predicted the number of repossessions is expected to expand by around 4,000, going from 36,000 in 2010 to 40,000 in 2011.

And it revealed it expects the number of mortgages in arrears to reach 80,000 next year, up from 175,000 this year.

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