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As more homes fall into mortgage arrears, the Australian Banking Association has told strugglers: "Don't tough it out on your own."
The association's message is targeting borrowers now buckling under radically higher monthly repayments from one year ago.
Repayments have skyrocketed as interest rates have been jacked up from a record low 0.1 per cent in May last year to 4.1 per cent by June.
READ MORE: Inflation rises in September quarter, deepening fears of further rate rises
And with the latest figures showing inflation had risen 1.2 per cent in the last quarter, there are growing fears the Reserve Bank of Australia will increase interest rates again next week.
The association said anyone struggling with loan repayments should contact their bank as soon as possible.
"The earlier people reach out, the faster banks can help. Don't tough it out on your own," association chief executive Anna Bligh said.
She said recent data showed most customers are keeping up with their repayments, "and that arrears are well within historical ranges".
However, according to global ratings agency S&P, the number of households that have fallen a month or more behind in mortgage repayments over the past year has increased in every state and territory.
Economic analysts have anticipated the number of people in arrears will increase as more people move off very low fixed rates.
Over the coming months, another 550,000 Australians will roll off fixed mortgages and onto much higher variable rates.
According to figures released in June from credit bureau Equifax, there has been a 33 per cent rise in mortgage repayment arrears across all lenders, compared to the same time last year.
The Equifax arrears data appears to tally with recent statistics from market research company Roy Morgan which they claimed showed there have never been more Australians "at risk" of mortgage stress.
A record high of 1.57 million people deemed "at risk" represents nearly one in three of all borrowers, Roy Morgan said.
The RBA has been hiking rates to try and bring down inflation.
Inflation now sits at 5.4 per cent, well above its 2 per cent to 3 per cent target.
The central bank will make another call on rates next Tuesday, and a number of banks including NAB, ANZ, CBA, AMP and HSBC are all predicting another hike, to 4.35 per cent up from 4.1 per cent.
For the past four months, the bank has held interest rates steady.
Bligh said "the spiral into financial hardship can happen very quickly" so early assistance can make a real difference.
Banks may help, she said, by lowering home loan or credit card payments; restructuring the length of a loan; moving a customer to interest-only payments for a while or deferring payments for a period.
