24/07/2008 by Dave.

An industry figure has claimed around one-fifth of people face having their homes repossessed because they have borrowed too much to purchase them.

Frances Walker, a spokesperson for the Consumer Credit Counselling Service (CCCS), claims some people are looking at the prospect of losing their properties because they can no longer afford to repay the amount they borrowed.

When describing the increase in the number of calls her organisation has received she said: “What we are finding is about a fifth of the people have simply borrowed too much and it might have to be [that] you give up your house”.

Those who are struggling to repay their mortgage should prepare a budget to help manage monthly outgoings and organisations such as the CCCS and Credit Action can help them formulate a plan, Ms Walker added.

According to the Council of Mortgage Lenders, more than 27,100 homes have been repossessed so far this year, the highest figure recorded since 1999.

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22/07/2008 by Dave.

People in the UK and Ireland are feeling their debt burden hit their quality of life more than any other European countries, according to a survey released this week.

The findings from price comparison site uSwitch.com pile on the misery faced by consumers in the wake of recent warnings by the British Chambers of Commerce of a pending recession in the UK. 

News that the Consumer Price Index (CPI) is running at an 11 year high of 3.3%, coupled with the recent warning that the price of goods is climbing faster than at any time in the past 22 years will do little to move the UK ahead in the rankings for some time.

Mervyn King, governor of the Bank of England warned consumers last month to brace themselves for “the most difficult economic conditions in two decades,” blaming a sharp increase in inflation from 2.1% in December to 3.3% in May on the increased cost of food, fuel, gas and electricity.

Spain was found to have the best quality of life and France in second place, while the UK and Ireland languished in the bottom two places, largely because of increasing inflation and third highest spending on utility bills.

Between 2006 and 2008 alone, the cost of diesel in the UK has increased by 38%. The UK is now the most expensive place to buy diesel at £1.32 per litre, 20p more than the European average.

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16/07/2008 by Dave.

The UK’s overdraft and personal loan debt levels have increased from £161 billion to £177 billion over the past year, with more people having to use them to cope with everyday living costs.

Recent figures from the Bank of England reveal the average authorised overdraft rate on a current account rose from 17.4 per cent to 17.9 per cent in June yet increasing numbers of consumers are forced to use those funds as the cost of living continues to soar, the Telegraph reports.

In addition, fewer personal loans are being granted by lenders, which is leaving people with few options, according to Tim Moss from moneysupermarket.com.

“The number of personal loans has fallen dramatically due to the tougher lending criteria from banks, so to still see such a rise in personal debt implies that people are using their overdrafts as a way to cope with everyday living costs,” he told the news provider.

According to figures from the Office of National Statistics, nearly two-thirds of consumers are unaware of what they are being charged by their overdraft provider.

Research conducted by Grant Thornton in 2007 found people in Britain accumulated so much debt it surpassed the entire value of the economy.

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11/07/2008 by Dave.

A debt advisory company is advising consumers whose debts have reached unsustainable levels they must take serious action before the problem escalates.

Consolidation firm debtadvisersdirect.co.uk claims people with significant money problems should seek advice from a professional who can discuss the various options available to help manage the problem.

A spokesperson for the company said those with financial difficulties which have become unsustainable should take steps to organise their repayments and work towards a solution.

“Once someone’s debts have reached a point where their income simply won’t stretch far enough, it’s imperative they take more direct action as soon as possible, whether that means a debt management plan, a debt consolidation loan or a different debt solution,” the representative said.

New figures from the Chiltern Debt Monitor have revealed people in debt can only afford to pay a quarter of it each month, however consumers owe on average £1,274 less than they did in August last year, falling from £26,662 to £25,388.

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09/07/2008 by Dave.

Research undertaken by the Money Advice Trust has revealed that around 165,000 households in the UK owe money to an illegal lender. The Trust has this week launched an online information hub which is set to be the most comprehensive source of information relating to debt.

As debt in the UK has spiralled out of control in recent times, this online help service is set to aid debt charities and others in the advice sector who need access to debt statistics and other data that could help them help those in need of debt advice. 89% of people questioned said that receiving advice has helped them from getting into further trouble.

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03/07/2008 by Dave.

The total average amount of debt has decreased steadily - although disposable incomes have dropped and it’s taking people longer to become debt free, according to the latest Chiltern Debt Monitor.

The study found that the amount people have left to spend each month, once living expenses are accounted for, has dropped by almost £10 and it is taking an extra three months to clear debts, compared to August 2007.

This means that people in debt can realistically only afford to pay a quarter of their contractual credit commitments each month, down 1%.

However, people owe £1,274 less each on average than they did in August of last year, down from £26,662 to £25,388.

Chiltern’s Nathan Gladwell says: “Our figures show that people are applying the brakes sooner with their spending, or seeking help earlier than they were previously which is a positive sign.”

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