Following the Bank of England’s decision to raise interest rates for the seventh successive time from 1.75% to 2.25%.
Andrew Gething, managing director of MorganAsh said: “In the current climate, it should come as no surprise to see the Bank of England raise interest rates for the seventh time in a row up to 2.25 per cent.
“It will undoubtedly feel like another blow for borrowers, house buyers and mortgage holders, especially those coming to the end of a fixed rate term who will be looking at a hike in rates, or those with tracker mortgages or on Standard Variable Rates.
“As the cost-of-living crisis continues to bite and more consumers potentially struggle to keep up with payments, a further rate rise could push more consumers into the ‘vulnerable’ category. It’s an important reminder to the sector to ensure systems are in place to identify when customers are vulnerable and protect those who are.
“As homeowners explore their options and many fixed rate mortgages mature in the coming months, identifying and monitoring vulnerable characteristics will become just as important as affordability checks or finding the right criteria. After all, brokers and lenders are duty bound by the upcoming Consumer Duty regulation to ensure they deliver good outcomes for customers.
“That means if bank rates do continue to rise this year as expected, businesses must pay extra attention to monitoring consumer characteristics throughout the customer journey and the life cycle of the product.”