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Debt problems to continue in 2007?

January 19, 2007 by admin  
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The Citizens Advice Bureau has voiced concerns that 2007 will lead to more debt for consumers.

The warning comes on the back of figures released by the British Bankers’ Association which show that mortgage lending rose during December 2006.

Statistics show that there was a £5.8 billion increase during December, slightly down on the record £6.7 billion growth seen in November, but still very high.

Citizens Advice says that during 2006, housing debt was one of the fastest growing problem areas and the figures from the BBA mean that this trend may well continue.

“The increase in loans and overdraft borrowing reflects the evidence from Citizens Advice bureaux that debt enquiries continue to rise in 2007 and will exceed the 1.4 million debt enquires we dealt with in the last financial year,” said Sue Edwards, senior policy officer at Citizens Advice.

BBA’s data also shows that credit card lending fell in 2006, in stark contrast to the huge growth seen in 2005. However, Ms Edwards does not believe that this is anything to get too excited about.

“The decrease in credit card borrowing simply indicates that people are borrowing in different ways,” she stated.

Consumer debt, which includes credit cards and other unsecured personal loans, was the biggest problem area for people seeking help from Citizens Advice.

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