Debt problems in the UK
Debt problems are on the increase in the UK, with many consumers finding it hard to balance the demands of mortgage repayments, credit card debts and the everyday expenses of running a household. With many also dealing with the threat of redundancy or the pain of losing their jobs, it’s inevitable that debt problems in the UK are on the increase.
The recession prompted by the credit crunch has had devastating consequences for many in the UK, particularly those with debts. Economic conditions in the UK are still highly challenging, with some analysts predicting that the UK will enter a ‘double-dip’ recession, rather than emerging from recession immediately as many people hope.
Debt in the UK: some facts and figures
While there are signs of recovery, unemployment levels remain high and activity in the housing market is still much lower than at its peak, with prices some way off their 2007 highs. The prevailing mood of consumers has improved to some extent, but the general emphasis still seems to be on saving rather than spending. For those with debts, these factors can add up to a disturbing picture.
Debt is a fact of life for many of us – an essential way for us to make our money go further and afford many of the key purchases in our lives. The facts and figures illustrate just how important debt is to the UK economy: the total UK personal debt at the end of October 2009 stood at £1,458bn. The average debt of households in the UK, including mortgages, is £58,316. An incredible £180m in interest is paid in the UK every single day.
Unfortunately, for many people in the UK, debt problems are mounting. Personal insolvency figures are projected to reach 130,000 by the end of 2009. The number of people filing for personal insolvency in the third quarter of the year was 35,242, an increase of 28% on the same quarter in the previous year and an increase of almost 7% on the previous quarter. That means that 2009 is set to break all records for personal insolvency, as the true consequences of recession start to really ‘bite’ for those with significant debts.
Mortgage debt
The situation with mortgage debt is no different. Mortgage repayments are usually the single largest payment that a household has to find each month, taking a significant chunk out of the monthly income. With the ready availability of larger mortgages, many for up to 100% of the property value, in recent years, a large number of people have taken on mortgages that are now stretching their finances to breaking point. This is borne out by the figures: at the moment in the UK, a property is repossessed every 11.2 minutes.
Help with debt problems
Clearly, debt problems are a reality for many of us. But the good news is that there are a number of well-established, effective measures that can be taken to improve your situation if you find you are faced with debt problems. Whether you need help and advice with IVAs , Debt Management Plans , Trust Deeds or bankruptcy , we can support and guide you through the process of understanding and dealing with your debt.
If you feel ready to start dealing with your debt problems, one of our specialist debt advisors can help you decide the best way to proceed. Contact Debt Options , apply online or call us on [???????]; to discuss the options.
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