One in four borrowers don’t know the base rate

Recent research has shown that an amazing one in four mortgage holders are unaware that interest rates are at an historic low of 0.5%, research from Shelter shows.

In a survey of more than 1,500 UK homeowners, 25% believe current interest rates are either higher or the same than they have been in the past or simply don’t know.

Within the 25% who are unaware, 9% of mortgage holders believe interest rates are slightly higher than they have been in the past, whilst 4% believe they are much higher than they have been previously.

The housing and homelessness charity is highlighting the research, conducted by the Council of Mortgage Lenders last year.

Shelter is warning the equivalent of 2.8 million homeowners may be completely unprepared for the costs of rising interest rates based on their lack of awareness about where they are currently.

Campbell Robb, chief executive of Shelter, says: “Even for those who have been managing to stay afloat so far, we know only too well that just a small increase in some people’s monthly outgoings will be the trigger that finally pushes them over the edge into a spiral of debt, repossession and possible homelessness.

“Millions of homeowners could be pushed to the brink unless they start making preparations now. We are urging people to find out if rising interest rates will affect them and prepare themselves for increasing mortgage costs by seeking advice early to help avoid putting their home at risk.”