Millions of homeowners could be at risk of defaulting on their mortgages due to higher interest rates this year, according to new research from Moneyhub Decisioning.

Moneyhub’s analysis discovered {that a} quarter (26 p.c) of house owners surveyed with a mortgage stated {that a} additional interest rate rise would imply they gained’t have the ability to afford their mortgage funds.

In addition, a 3rd (35 p.c) of house owners with a mortgage stated they have been involved that they won't be able to afford their mortgage after they remortgage attributable to rising charges.

However, these approaching the tip of their present mortgage deal and want to remortgage have been urged to not lose hope.

Perry Graves, mortgage knowledgeable at Tembo informed Express.co.uk: “There are ways to access lower interest rates and reduce your monthly repayments.”

READ MORE: Mortgage crisis could be solved by 25-year fixed rates, says Michael Gove

Extend the mortgage time period

When it involves remortgaging, Mr Graves stated individuals can select to alter their mortgage so it has a long run.

He stated: “If you currently have a 25-year mortgage, you could extend it to a 30 or 35-year mortgage as long as you meet the lender’s age requirements. Some lenders can cap the maximum age at 70 or 75 or 80 - it’s not one size fits all.

“Extending your mortgage term allows you to pay less each month, but over a longer period of time. However, because you’ll be paying off your mortgage for longer, you'll pay more interest overall.”

Although, extending to a longer-term deal doesn’t imply a person is caught with it till the tip of their mortgage.

Mr Graves stated: “You could switch to a longer-term now, then remortgage to a shorter term later down the line if you meet requirements at the time.”

Consider switching to an interest-only mortgage

Moving to an interest-only mortgage can be utilized as a device to maintain repayments reasonably priced with out having to maneuver home.

However, Mr Graves stated: “It’s best to use this as a short-term solution, otherwise you will have to pay your remaining mortgage balance at the end of your mortgage term. This is heavily dependent on income and the amount of equity in the property.

“You’ll also need a suitable repayment vehicle to repay the interest-only element at the end of the term.”

Improve your credit standing

Having a low credit standing tends to restrict mortgage choices and will depart an individual in danger to being supplied a lot greater charges.

Mr Graves stated: “Lenders often see those with poor credit as higher risk. By improving your score in the run-up to your remortgage, you could get access to better rates.”

Add a guarantor to your mortgage

By including a cherished one or good friend to a mortgage as a guarantor, individuals can “increase” their affordability.

Mr Graves stated: “One of the issues that people are having at the moment is their current affordability might not be enough to cover their existing mortgage.

“This generally happens for people who bought with smaller deposits and whose financial position may have changed. For example, they might now have childcare costs impacting their affordability.”

Pay off a lump sum

Depending on the loan-to-value (LTV) share of the mortgage, Mr Graves stated it might be worthwhile making a lump sum overpayment to get entry to decrease charges.

He added: “Calculating the difference between interest rate/monthly payment/capital outlay is key.”

Worrying about dropping a house is a big concern to have, nonetheless, Mr Graves famous: “It’s so important to not bury your head in the sand. Talk to your mortgage lender to see what options there are - they have a legal obligation to help you and will only use repossession as a last resort.”