Rate cuts may have come too late for home borrowers already behind in repayments, with the rate of arrears across the nation's housing market tipped to rise further as the economy cools.

Lenders such as Adelaide Bank, Challenger Financial, Liberty Financial and Bluestone will be hardest hit by the losses after funding billions of dollars of loans to higher-risk borrowers over recent years.

The latest analysis of the nation's mortgage market by ratings agency Standard & Poor's shows that more than 15.3% of loans issued to so-called subprime borrowers remain in arrears. The bulk of these are more than three months overdue — the most severe category before banks and other lenders class a problem loan as being in default.

The Age