More trouble as the number of people struggling with loans could double
18/04/08
In 2008 it seems like more gloom is ahead as the number of people struggling with their debts could double a report revealed earlier today.
According to debt management solutions firm TDX group whose clients include financal institutions such as Alliance & Leicester, HSBC, HBOS, etc, it is estimated that something around the region of one million borrowers have a problem with unsecured debts and in monetary terms the debts add up to around £25 billion. According to the TDX Group this averages out to approximately £25,000 per borrower. As much as 60% of this debt is owed on credit cards according to the report out today with the remainder mostly on personal loans.
The report blames the slowdown in the current property market and personal inflation seeing an increase being some of the factors which could result in an increase in the number of people experiencing difficulties.
"There will be fewer refinancing solutions such as re-mortgaging and homeowner loans available, because banks and building societies have tightened up their lending criteria. This could mean there could be a doubling in the number of people taking out repayment plans such as individual voluntary arrangements (IVAs) and debt management plans." A spokeperson said earlier today.
