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Average personal debt hits £4,000 |
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The following was taken from the BBCs website:
The average Briton owed £4,000 in unsecured debt at the end of 2004, 10% more than in 2003, a report suggests.
Market analyst Datamonitor said the 2004 figure is 45% higher than at the start of 2000.
In 2004, the average adult owed £1,302 on credit cards, £1,892 on unsecured personal loans and £812 on overdrafts and motor and retail finance deals.
Datamonitor´s calculation is based on industry and official figures and excludes mortgage debt.
Debt build-up
The average £4,000 figure excludes credit card debts which are built up and paid off on a monthly basis.
The level of total personal debt - both secured and unsecured - broke through £1 trillion in July 2004.
Britons are accumulating debt at a faster rate than consumers in the US and many European countries, the Bank of England recently said.
"One of the major reasons behind this strong performance is the fact that the majority of bad debt indicators, such as unemployment, records of mortgage arrears and repossessions and county court judgements remain at their historically-low levels," said Oksana Selezneva, author of the Datamonitor report.
"This has given consumers the confidence to keep on borrowing and the ability to cope with their debt repayments relatively well."
Credit bubble
A number of recent surveys have however highlighted a growth in "problem" debt.
A report by PKF Accountants showed that young people were being forced into bankruptcy after accumulating big personal loan and credit card debts.
PKF´s recent survey of Scottish insolvency cases showed that nearly two thirds of personal bankruptcies were among young people under 30, who were using credit to fund lavish lifestyles they could not afford.
However, in the short term, with interest rates and unemployment still low, most commentators do not expect the credit bubble to burst.
The Council of Mortgage Lenders expects repossessions to rise from 6,000 in 2004 to 10,000 this year.
However, this is still very low by historical standards.
If you have any questions in relation to this or any other matters please do not hesitate to contact me and remember there are a whole host of free news items and other credit resources to be found at www.debtscotland.com .
Stephen Cowan
Yuill & Kyle
Debt Recovery & Credit Control Lawyers
scowan@yuill-kyle.co.uk : 0141 572 4251
www.debtscotland.com
www.ykcreditcheck.co.uk
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