Personal debt levels rise to £160bn in the UK

A recent report carried out by a think tank has revealed that unsecured debts amongst Britain’s poorest families are now at record levels. Research carried out by Maxed out, a right leaning think tank is concerned that some of Britain’s hard pressed families are caught up in a perfect storm with rising living costs and expensive credit.

It has calculated that the worst off have seen their bills increase by 25% and many families are unable to meet their monthly mortgage payments or rent. This is causing thousands of families to become homeless.

What is concerning is that because some of the poorest households are unable to access banks for loans because of their poor credit rating which is pushing them toward pay day lenders and loan sharks. They also found that some families were spending half of their monthly income on debt repayments to payday lenders.

Families across Britain now have levels of debt not seen before with debts of £1.4trn. This means that on average families now have debts of £54,000 which is twice the level of a decade ago.