Debt in Britain this is proper shocking __________________________ Around a quarter of working Britons will be refused loans, mortgages and credit cards by 2011 as they struggle with mounting debts, latest research shows. Analyst Datamonitor said the number of borrowers blacklisted by mainstream lenders will increase from 7 million to 8.6 million over the next four years. Five increases in the interest base rate over the past 12 months, rising taxation and the increased cost of living are causing more people to default on their debts, it said. "Last year saw an increase in this population for the first time in many years, as the financial difficulties consumers are experiencing are gradually feeding through," said Maya Imberg, financial services analyst at Datamonitor. Lenders are rejecting individuals for a number of reasons, including county court judgements, unemployment, bankruptcy or being in receipt of income support, as more people struggle to make ends meet. Meanwhile, the number of houses taken into repossession in the first six months of this year rose by nearly a third to the highest level for eight years, according to the Council of Mortgage Lenders (CML). A spokesman for the Consumer Credit Counselling Service (CCCS) said: "We expect problems in the future because mortgage debt is continuing to rise and the jury is still out whether we are going to have another rate increase before the end of this year." Recent figures also show there was also a big rise in county court judgements, with around 250,000 in the first three months of the year, the highest quarterly figure for a decade. Individual insolvencies increased in England and Wales by around a third last year to 62,920. The UK's outstanding consumer debt, including mortgages, has risen to a record £1.3 trillion, while savings have sunk to a 50-year low. Lenders are already raising rates for credit-impaired borrowers in the wake of the US sub-prime crisis, pushing those already battling with debt into deeper waters. Over the next 18 months the situation could get worse, with millions of borrowers set to move from cheap fixed-rate deals on to their lender's standard variable rate. This could see their repayments rise by around £100 a month or more. "The pain may not have hit yet as people are still on low fixed-rate deals, which will soon end," said the CCCS. http://money.guardian.co.uk/news_/story/0,,2153902,00.html
Not really surprising though. Something needs to burst the debt bubble. Whatever happened to saving for something before buying it (apart from a house or similar)? I know people that will struggle to get out of debt before middle age because they have been so reckless when younger.
Recently, I have seen so many people who simply cannot afford to pay their mortgages any more, they are coming to try and get help and we can't or more realistically won't help them. Situations where banks are now becoming more risk averse to who they will give money to, eg the max we will lend on a mortgage now is 90% or 95% for graduates which I think is the case for momst lenders now on mortgages. Pretty much everyone I see has loans and credit cards coming out of there ears and they don't really have a way out of it. Bit shit really
..... I hate debt. I went into IT contracting cause i was sick of the idea that it would take me till i was thirty to be debt free - Thankfully on paper i have more in savings now than i do in money i owe. Its a good feeling. Debt is seriously depressing
i've got a good wedge like. But man have i had fun spending it.. i normally save hard and budget and then almost pay it all off, then have a mental few months (i.e. the summer) where i just wazz it all again.
