Millions of Britons could face the threat of repossession as well as credit card debt, it has been claimed, following a survey showing an increasing n…
Millions of Britons could face the threat of repossession as well as credit card debt, it has been claimed, following a survey showing an increasing number of people have been using plastic to pay their mortgages off.
A poll for homeless charity Shelter found six per cent of householders – over two million people – used cards to pay their rent or mortgage in 2010.
This figure was up by half on the four million who did so in 2009 and could lead to a major rise in credit card debt as the extra borrowing is increased by interest while homeowners struggle to deal with ongoing monthly payments.
Commenting on the situation, Shelter chief executive Campbell Robb said: “This is a totally unsustainable situation and one which we fear could see thousands more families pushed into the spiral of debt, eviction or repossession and ultimately homelessness.”
He added: “With the average credit card interest rate now standing at over 16 per cent it is the worst possible course of action.”
Mr Robb said anyone who has been considering this option should seek help urgently.
One extra reason for taking action now is the prospect of monthly accommodation payments increasing in size over the next 12 months.
A poll for Paragon Mortgages found 41 per cent of landlords saying they expect to raise rents during the course of 2011, with 30.7 per cent saying they anticipated doing so by up to four per cent and the rest suggesting the hike would be between four and eight per cent.
By James Francis