Expectations are mounting that 2014 could be the year the Bank of England finally hikes base rates and pushes up monthly mortgage repayments for millions of households.
In March 2014, the Bank will have held base rates at their all-time low of 0.5% for five years.
But a new survey from Capital Spreads showed that 40% of fund managers expect interest rates to rise in 2014, as the economy grows faster than expected, and unemployment continues to plunge.
A faster than expected rise in interest rates could drive two million families "to the edge of their means" as their mortgage payments soar, a think tank has warned.
The Resolution Foundation said the number of British households spending more than half of their disposable income on debt repayments could triple by 2018 if rates rise faster than anticipated.
It accused politicians of ignoring the looming crisis and urged banks to begin checking mortgage customers to ensure they can cope with a sudden rise in repayments.
Chief executive Gavin Kelly said: "There is huge uncertainty about income growth and interest rates but under almost any plausible scenario there is going to be a big spike in the next Parliament.
'We could well be talking about this issue as much as we are currently discussing wages or energy bills. As yet there is little sign of the political or financial establishment giving this the priority it deserves."
A survey by Which? today found that 13 million adults borrowed money to pay for Christmas and 2.5 million won't have paid off these debts by June.
Although 2015 still looks the more likely date for a base rate hike, as the Bank considers other methods of preventing a housing bubble, fear of what will happen when rates do rise will inevitably grow over the coming months.
Comments