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Retired people have thousands of pounds on credit cards and loans

admin — Tue, 29 Sep 2009 06:50:28 +0000

It has been reported that retired people in the UK have thousands of pounds outstanding on credit cards and loans, with the average debt amongst retirees said to be on the increase.

The report was put together by the Scottish Widows UK Pension Report and relates to non-mortgage debt amongst consumers of retirement age. This further reflects the worrying levels of personal debt that are being seen in the UK amongst most age groups.

According to the results of the study non mortgage related debt, which includes that seen on personal loans and credit cards, has increased by over £600 since last year, and since 2007 has increased by over £1400.

Around one in six retired people also have an outstanding mortgage with around £50,000 outstanding on it, which again is an increase on last year of around £8000.

One industry official stated that the recession did not seem to be having any effect on the willingness of people to repay their debts, stating: “The recession has seemingly done nothing to encourage retirees to cut their debt, and with the possibility of the value of their property dwindling, they could be leaving themselves in a vulnerable position. Those in retirement should be able to enjoy life and not worry about the financial burden of debt, as well as their retirement income.”

Industry officials have said that given these rising figures and the worrying level of personal debt amongst those of retirement age it is increasingly important for those that are nearing retirement to ensure that they make provisions to clear off as much of their personal debt as they can to avoid severe financial problems.

This includes clearing as much oustanding debt as possible off credit cards, store cards, personal loans, and other non mortgage related debt.

Retired people have thousands of pounds on credit cards and loans is a post from: Nicon Debt Management

Consumers should budget to pay off credit card debt

admin — Mon, 24 Aug 2009 08:37:45 +0000

Consumers in the UK have been advised to budget properly to ensure that they manage their credit card debt effectively. A leading debt advisor has been offering tips and advice on how best to budget to ensure that consumers can make effective repayments on their credit card debts, stating that it is vital that consumers are both honest and strict when it comes to their budgets so that they could then keep their debt levels under greater control.

The advice and tips were offered by the Consumer Credit Counselling Service. Officials from the group said that consumers have been becoming more financially responsible over recent months, and have become more responsible with their borrowing, having seen just how much chaos can be caused through irresponsible borrowing and lax attitudes over debt repayments.

However, due to the recession and the financial climate some industry groups have said that the level of credit card and debt defaults could rocket over the next couple of years.

One official from the CCCS said that consumers who found themselves increasingly relying on credit cards to meet essential everyday costs could be heading for financial meltdown, and therefore it was important for consumers to start budgeting sensibly before things went this far.

He stated: “You need to take steps to confront your situation, and rectify it as soon as possible, and your first step should be to make a strict and truthful budget that will set out your finances and help you see where you are overspending, can cut back, and such like.”

Consumes have also been advised that if they do find themselves in a situation where they are struggling to repay their debts or sort out a sensible budget they should seek professional advice from debt charities or the Citizen’s Advice Bureau.

Consumers should budget to pay off credit card debt is a post from: Nicon Debt Management

Increasing credit card defaults making recession worse

admin — Tue, 18 Aug 2009 08:31:49 +0000

It has been claimed that the recession in the UK is being made worse by the rising level of credit card defaults that have been seen recently. According to reports families are being forced into a very difficult financial situation, with tens of thousands of families being affected by the high level of credit card defaults.

Officials from the Organisation for Economic Co-operation and Development claim that British families have the highest debt levels of any major economy, and this is driving many of them to financial ruin.

Between April and June of this year banks are said to have written off around £1 billion in credit card debt, and these figures are expected to be confirmed over the coming weeks in a report from the Bank of England.

The figure is said to be the highest since the last recession in the early 1990s, and is sixteen times higher than in 1997 when the current government came into power. It is also expected to continue rising over the course of this year.

One insolvency specialist stated: ‘More and more people are staring financial ruin in the face. The number defaulting on their credit card debts is growing, and therefore the number of personal insolvencies will grow over the next two years. We have lost the value of thrift in this country, and so people don’t have any savings to fall back on. This is all very well when people are earning, so they can afford to service their debt, but if they lose their job they’ve had it.’

The Tory Party put the blame at the doorstep of Prime Minister, Gordon Brown, stating: ‘The thousands of families being pushed into credit-card default is the human face of Gordon Brown’s decade of irresponsibility.’

Increasing credit card defaults making recession worse is a post from: Nicon Debt Management

Nearly a century to clear a £5000 debt with Barclaycard

admin — Mon, 27 Jul 2009 07:37:20 +0000

A shocking recent report has shown how it could take consumers nearly a whole century to clear as little as £5000 worth of debt on their credit cards with Barclaycard.

This means that some consumers would never be able to clear the debt in their lifetime, reflecting just how long credit card debt can linger for some consumers. It is reported that as a result of the credit card giant cutting the required minimum monthly amount it could take some cardholders with a balance of just £5000 a whopping ninety eight years to clear the debt.

Barclaycard recently announced that it was reducing the minimum level of repayment required from cardholders. The previous minimum level was 2.25 percent of the balance or £5 minimum repayment.

However, this has now changed to just 1.5 percent of the balance of £5 minimum repayment depending on which is the greater. For those that plan to make only the minimum repayments on their cards it could take them much more than a lifetime to clear their relatively modest credit card debt with Barclaycard.

Officials from Barclaycard have said that the reason that the minimum monthly amount required has been reduced in this way is to help consumers who may be struggling to keep on top of their finances in the current financial climate.

They claimed that the reduction in minimum monthly required payment would mean that consumers could free up cash to make other payments such as bills or to meet their mortgage repayments and avoid losing their homes.

However, many officials are sceptical about this, and feel that the credit card giant is trying to make millions of extra pounds in interest by letting consumers’ credit card debts fester for longer.

Nearly a century to clear a £5000 debt with Barclaycard is a post from: Nicon Debt Management

Warning for solicitors over debt clearance firms

admin — Wed, 13 May 2009 07:46:50 +0000

A warning has been issued to solicitors over accepting services from firms that claim to be able to write off people’s loans and credit card debts.

According to officials from the Solicitor’s Regulation Authority there has recently been an increase of misleading adverts, including ones run online, from firms that claim to be able to write off these debts for people. Some of these firms have claimed that credit agreements can be written off in many cases, as they are not enforceable, which the regulatory body has said is not true.

The regulator is also investigating ten firms under the solicitors’ code of conduct. Chief Executive of the SRA, Antony Townsend, said: “These adverts appear to offer an easy way out of difficulty to people who have debts they are struggling to pay. But many credit agreements do meet the legal requirements and, therefore, can’t easily be challenged as unenforceable.”

The warning is now being issued to solicitors telling them to be on their guard about these debt clearance firms, and those solicitors that do not heed the warnings could find themselves in very hot water.

If they do deal with these firms they could find that they are in breach of their code of conduct, and this could result in action by the Solicitors’ Disciplinary Tribunal, which could ultimately result in the solicitor being banned from practising. It has also been made clear that any debt firms that are licensed by the OFT, who then publish misleading material could face fines of up to £50,000.

The Ministry of Justice also printed details of claims that could be construed as misleading by these firms in a report last year, and this included a firm that was claiming that around 80 percent of credit agreements could not be enforced.

Warning for solicitors over debt clearance firms is a post from: Nicon Debt Management

Consumers in UK cutting back on spending to try and get rid of card debt

admin — Mon, 30 Mar 2009 08:17:59 +0000

At this time of year many people are usually still lumbered with a heap of credit card debt, often on a number of different cards, and this is often as a result of the recent Christmas and New Year period, which for many people involves having to rack up huge levels of debt on their credit cards for things such as food, entertainment, clothes, gifts, travelling, and more.

Whilst some manage to repay the balance in full once Christmas is over many others spend months trying to get their credit card accounts back on track.

For some people repaying their Christmas spending balance month by month does not usually prove to be a problem, particularly for those with 0 percent purchase cards who can get away with paying no interest on the borrowing as long as they repay the debt in full within the interest free period.

However, this year many are facing an uncertain future in terms of their jobs due to the recession, and the poor financial climate is taking its toll.

In fact, the results of a recent survey carried out by Legal & General have suggested that around 20 percent of people in the UK are cutting back on their spending and trying to save money so that they can pay off their debts that they accrued on their credit cards over the Christmas period.

It is thought that the level of cutbacks in overall spending will have a further impact on the economy, which is not good news given that the nation has already fallen into recession.

The study also showed, however, that the nation’s appetite for credit card spending has not waned, despite the financial climate and uncertainty over jobs. The figures showed that many people who expected their credit card debt to fall in the next twelve months planned to use their credit cards to make everyday purchases.

Consumers in UK cutting back on spending to try and get rid of card debt is a post from: Nicon Debt Management