Credit Card Use 'To Rise'; More Debt Solution May Be Needed

Printer-friendly versionPDF version

A fresh report warns that the nation's overall credit card debt is likely to increase if mortgage costs rise. This may lead more people to ask for debt solution.

London (online debt advice) 26 Nov 2007: Credit card debt is likely to increase if mortgage costs rise. This is revealed by a new report. According to accountancy firm PricewaterhouseCoopers (PwC), over-borrowing by consumers may also result in a higher number of personal insolvencies next year.

The latest annual report from this agency on consumer credit claims UK households have already stretched their borrowing capacity, with the average adult now owing £33,000 in unsecured debts – up from £17,000 in 2000. This makes many of them seek for debt solution to handle their debts better.

Precious Plastic, as the study is entitled, warns the situation could be exacerbated when fixed-rate deals of many mortgage purchasers expire in the coming months. As of now, more than a million people are expected to come off their existing fixed-rate home-loan deals in 2008. PwC warns that their average monthly mortgage repayments could increase by £140 as a result of this.

The report also suggests that further pressure is likely to be placed on consumer spending due to higher home-loan costs as more people may also default on loan repayments.

For more information visit at: http://www.onlinedebtadvice.co.uk/