Personal debt worries afflict ten million

by Gill Montia

Story link: Personal debt worries afflict ten million

The financial website, uSwitch.com, has published details of a survey that shows the extent to which the nation is gripped by personal debt.

According to the survey, over ten million adults believe they cannot cope with rising mortgage payments and other debts.

Twenty-three per cent of respondents expressed the fear that their current level of borrowing is unmanageable or is about to become so.

Twelve per cent, or 5.4 million UK adults, have missed payments on loans and bills in the past six months.

During the same period around 10% reported that they had a direct debit, cheque or other payment bounced by their bank.

Around 3% live in fear of being unable to meet mortgage payments and losing their home.

The five interest rate rises since August of last year have increased repayments on the majority of mortgage by over £100 a month.

In addition, personal loans, overdrafts and credit cards debts have become more expensive.

The total amount now owed by UK consumers to banks and finance companies is estimated at £1.3 trillion and the survey has revealed that the average person is using half of his or her monthly take-home pay to cover mortgage repayments and other debts.

Ann Robinson, uSwitch’s director of consumer policy, believes that “The days of easy credit and the ‘buy now, pay later’ culture may be numbered, but they will leave a painful reminder for those left struggling with debt”.

The findings of the uSwitch survey are supported up by other studies published this week, by Mintel and Moneynet.co.uk.