CAB: Households face rising debt levels

Posted 2008-03-25

Household debt has risen significantly in the first two months of 2008, the Citizens Advice Bureau (CAB) has claimed. January and February saw a 215,000 year-on-year increase in the number of people contacting the charity for debt advice, with many of the inquiries relating to utility bills and council tax. The clear majority of requests still relate to credit and store card debt, however, while the number of people requesting advice over mortgage arrears has grown by a third. All in all the findings suggest that prior warnings about the credit crunch taking a toll on household finances appear to be materialising, with mortgage broker Savills warning of a looming surge in insolvencies and foreclosures. "Those homeowners who have lots of unsecured debt and face higher household bills may find the combination of these costs pushes their finances over the edge," Savills private finance director Melanie Bien ominously predicted. Recent research has warned that personal insolvency levels will reach record high levels in 2008.

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