There has been yet another survey conducted in the UK with yet another set of shocking and depressing findings…
The YouGov / Shelter survey reveals that almost 7 Million people are relying on some form of credit to help pay their housing costs, using payday loans, unauthorised overdrafts, other loans or credit cards.
The results reveal the spiral of debt that people are falling into in order to keep a roof over their head.
The survey asked 4,014 people in the UK if they had used payday loans, unauthorised overdraft, other loan or credit cards to help pay their rent or mortgage in the last 12 months.
15% (1 in 7) said yes, representing a national figure of almost 7 Million people, with almost 1 Million people using payday loans.
The homeless charity warns that 2012 could bring with it an increased risk of homelessness, for those who are struggling with their housing costs and is urging anyone worried about their debts to make seeking early debt advice their New Years resolution.
Shelter has a network of specialist advice services around the country, a free telephone helpline and online advice available at shelter.org.uk/debt, including a new budget calculator.
Campbell Robb, Chief Executive of Shelter, said, “These shocking findings show the extent to which millions of households across the country are desperately struggling to keep their home. Turning to short-term payday loans to help pay for the cost of housing is totally unsustainable. It can quickly lead to debts snowballing out of control and can lead to eviction or repossession and ultimately homelessness. Every two minutes someone in Britain faces the nightmare of losing their home. We urge every single one of these people now relying on credit to help pay their rent or mortgage to urgently seek advice.”
Martin Lewis of MoneySavingExpert.com, said, “The UK is the crock of gold at the end of the rainbow for the world’s payday lenders. They’ve been regulated out of other countries and jump for joy at our lax supervision. That’s why these 4,000% APR lenders are exploding across British high streets. Yet these astronomical APRs aren’t the real danger and that comes from the rollover. This is where people can’t repay at the end of the month and compound interest kicks in. It’s incredibly worrying there’s now evidence of people using payday loans to meet housing costs. Many struggling with core rent or mortgage commitments will struggle to repay payday loans on time too. While it’s an obvious temptation to grasp these loans as a lifeline, in the long run it may hurt more than help. Instead I’d urge anyone struggling with payday loan and housing debts to get in touch with one of the great non-profit, non-judgmental advisors out there, such as Shelter – the sooner the better.”
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