£1.46 trillion of personal debt in the UK

In November 2009, the level of personal debt in the UK reached a total of £1.46 trillion. Of this figure, £1.23 trillion was made up of mortgages and secured loans. The remaining £230 billion was made up of unsecured debt including credit cards and personal loans. The average debt per household who have some form of unsecured loan is c£21,000 excluding mortgages. 

With this level of borrowing, coupled with difficult economic conditions, it is not surprising that the number of people finding themselves struggling to repay debts is on the increase.

Debt can get out of hand for many reasons:

• A period of unemployment
• Ill health,
• A new baby
• A prolonged period of spending beyond a fixed income

Robbing Peter to pay Paul

Once debt starts to become a problem, there is not enough money left in the month to pay all the bills.  The first reaction of many people who find themselves in this position is to start robbing Peter to pay Paul. Credit cards are used to supplement income. A loan may be taken to consolidate credit card balances. When debt problems are at their worst, personal loans may be taken simply to provide enough money to maintain the required monthly repayments on other debts.

If you are facing a debt problem, the easiest thing to do is bury your head in the sand and hope that it will go away. Unfortunately this never happens and things tend to get worse and worse.

Real Solutions are available

There are a number of solutions available which will help resolve a serious debt problem once and for all.

These include:

Debt Management Plans
Individual Voluntary Arrangement
Bankruptcy
Debt Relief Orders

This guide will give you information about these solutions and when they are best be used.

The different options available will suit different people and different circumstances. It is therefore important to understand each of the different solutions. You will then be in a far better position to decide on the best way to resolve your debt problem.