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The Facts About Personal Debt in the Uk

By: Garry Crystal - Updated: 7 Aug 2012 | comments*Discuss
Debt Statistics Personal Debt Lending

Personal debt in the UK has reached a crisis level and reports of bankruptcies and home repossessions are now extremely common. The facts about personal debt in the UK show that for once the media has not sensationalised the UK debt crisis.

Personal Borrowing in the UK

Although Britain is in the middle of an economic depression this has not stopping lending or borrowing levels rising. Today, in the UK lenders will provide £175 million to borrowers, in just one day. Today, borrowers will pay £262 million in interest rates, in just one day. Unemployment in the UK is increasing by 1522 people each day and this figure is set to continue rising until the year 2010. These statistics alone should give a clue as to why Britain is facing debt levels on an unprecedented scale.

Credit Card Lending in the UK

Credit card interest rates are one of the major reasons for debt. Credit card borrowing in the UK has reached all time high records; the total amount in the UK stands at £238 billion, which is increasing daily. Around 24% of credit card users are still paying off credit card debts from the previous year’s Christmas. Estimates show that if a person repays only the minimum amount on their credit card balance it will take 30 years to clear.

Shocking UK Debt Statistics

Debt statistics in the UK are shocking and yet there is no significant deterioration in borrowing or lending. Here are a few statistics that may make you think twice before borrowing.

  • Debt in the UK increases by £154 million every day
  • The average household debt in the UK is £59,670
  • One person in Britain is declared insolvent or bankrupt every 4.8 minutes
  • In the UK around 124 properties are repossessed every day
  • The amount of interest paid on debt in the UK has now reached £252 million per day
  • The amount of people who owe money on credit cards but are unable to pay them has doubled in the last 12 months
  • Debt in Britain grows by around £1 million every nine minutes
  • The Citizens Advice Bureau deals with 6,600 problems concerning debt every day

Home Repossession in the UK

Having your home repossessed is one of the ultimate consequences of being in severe debt. The amount of properties being repossessed has almost doubled in the UK in the last year. In six months in 2008 almost 20,000 UK homes were repossessed by mortgage lenders. Britain’s housing minister claims that the crisis is nowhere near the level felt in Britain during the 1990s. This will give little comfort to those who have faced or are facing home repossession.

Winners in the Debt Crisis

Debt collection agencies are prospering due to Britain’s economic downturn. Debt collectors and bailiffs are making millions from the debt misery of others. In the last 12 months debt collection agencies pursued around 20 million debt cases and this figure looks set to increase. The Citizens Advice Bureau claims that underhanded debt collection tactics are a serious problem for thousands of people across the UK.

Debt Stress in the UK

Stress from debt is a huge problem in the UK and around 25% of people in debt are finding the stress too much to cope with. Doctors say that treatment for depression and anxiety due to debt are common. There have been reports in the media of debt stress leading to absenteeism from work, alcohol and drug dependency and in some cases, suicide.

Students and Debt Figures

Students are in for a reality check when they eventually leave college or university. The average student who graduates will usually find themselves with a debt of around £13,500. This figure looks set to increase to £20,000 for those now starting a three year university degree course. Around 60% of students claim that finances and debt are their main worries as opposed to finding employment when they leave university.

Britain’s Debt Time Bomb

Britain’s buy now and pay later culture has been a time bomb waiting to explode. The personal consumer debt figure has now reached well over the £1 trillion mark. Over £1.4 billion bad debts have been written off by banks in the last 12 months. These debt statistics are shocking, but lending and borrowing in the UK seems to be on the increase, as does Britain’s personal debt figures.

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