Half the nation concerned about their debts

Nearly half of individuals (47%) are concerned about their debts, according to the latest wave of R3’s, the insolvency trade body, Personal Debt snapshot.  The quarterly tracker of the nation’s finances reveals a 7% rise in debt concern, compared to this time last year.

Of those who are concerned about their debts, credit card debt continues to dominate fears for 53% of individuals; an increase of 5% on last quarter.  Concern about certain types of debt has increased this quarter:  Payday or other short term loans (up 2%), hire purchase (up 3%) and store cards (up 1%); while worry about secured lending has reduced such as mortgage repayments (down 4%) and bank loans (down 2%).

Frances Coulson, R3 President comments:

“Households that are already struggling may find traditional lenders unwilling to provide further credit and are therefore drawn to short term credit solutions.  Individuals turning to short term loans and credit cards should be wary of the high interest rates that often accompany these products.  Overall debt can quickly snowball out of control.

“Concern about secured lending is also likely to have fallen due to the Bank of England continuing to keep interest rates at a historic low.  Households have begun to feel comfortable that their mortgage repayments will remain as they are for the foreseeable future.”

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