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One-quarter of borrowers fear mortgage debt

One in four people aged between 25 and 44 fear they will not be able to meet their mortgage repayments in the next four months, according to Debt Management Associates.

The company says the findings show that borrowers are taking on more than they can afford.

It says while debate focuses on what people can afford to buy, the real issue is that they will not be able to sustain their level of borrowing.

DMA asked 2,000 people about their debt worries over the next four months. Around 49 per cent of those questioned fear they will not be able to pay their debts, rising to 65 per cent of those between 25 and 34.

Those under 45 are four times more likely to be worried about mortgage repayments than they are about credit and debit cards.

DMA is warning people to look at their monthly expenditure and calculate how an increase in interest rates could affect their ability to make repayments.

Managing director Brendan Kiem says: “The reduction in mortgage costs to their lowest levels in 40 years has fuelled a renewed surge in house prices. While people are extending themselves to afford these inflated prices in the short term, they are running the risk of not being able to service such debts in the future.”

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