Millions of UK households will face "perilous" levels of debt when interest rates begin to rise, according to a think-tank focused on living standards.

The number of people using more than half their disposable income to repay debt could rise from 600,000 to a 1.1 million by 2018 if interest rates rise to 3%, said the Resolution Foundation. If rates hit 5%, two million households would face huge repayments, it said. Mortgages are the largest source of UK household debt. The Resolution Foundation study used the latest five-year growth projections from the independent Office for Budget Responsibility. "Even if we take a somewhat rosy view of how the economy will develop over the next few years the number of households severely exposed to debt looks as though it will double," said Matthew Whittaker, the senior economist at the Resolution Foundation.....Read more here