Debt falls in real terms
Posted in Debt News, on Tuesday, November 7th, 2006New figures from Alliance & Leicester show that UK consumer debt is falling in real terms for the first time in more than ten years. The report estimates that consumer borrowing, excluding residential mortgages, is growing at a rate of just 1.4% - less than inflation, resulting effectively in reduction of borrowing.
The figure contrasts sharply with a ten-year average of 11.7%, and A&L suggests that this year has been a ‘turning point’ in peoples’ attitudes to debt, with levels of unsecured borrowing falling relative to increasing earnings, and many people making a conscious decision to reduce their debt.
Credit card debt has fallen every month between February and August this year, alongside unsecured loans growing at the slowest rate for 13 years.
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January 10th, 2007 at 2:56 pm
According to Cleardebt this is due to a phenomenal growth in the number of IVAs However this trend is not being followed in Scotland, north of the border the number of debtors is continuing to rise due to a fewer number of homeowners.
Mike Gerrard, head of Grant Thornton, told the Scotsman: “While the figures may suggest belt-tightening exercises up and down the country, people are still spending.
“In fact, during 2006, Britons borrowed almost £14 billion in unsecured lending alone.”
However, John Hall, chief executive of Invocas, added that the “phenomenal” growth in IVAs will be matched by the Scottish equivalent of Trust Deeds in order to tackle outstanding repayments.
The news comes as research from the Future Laboratory states that more people are having to lease goods rather than buy them due to their levels of debt.
January 17th, 2007 at 12:51 pm
Marie - good tip in ClearDebt . I just checked it out online - they have a really cool online IVA checker that tells you if you qualify. Not like a lot of scammy sites!