March 20, 2008
Advice Charity Sees Arrears Cases Rise By A Third
Over a third more people are seeking help because they are having problems paying their mortgages.
According to figures released by national charity Citizens Advice, mortgage arrears problems have risen up by 35% in the first two months of 2008 compared with the same period in 2007.
The new figures also reveal continuing increases in problems relating to basic essentials such as gas and electricity, water, telephone and council tax bills.
A survey of Citizens Advice Bureaux in England and Wales reported that they dealt with 215,000 new debt problems in the first two months of 2008 alone.
Teresa Perchard, director of policy for Citizens Advice says: “It is a worrying trend that our bureaux are reporting a very sharp increase in the number of mortgage arrears problems they are dealing with. These latest figures paint a worrying picture, suggesting a significant number of households are struggling to meet their most basic living costs.”
Debts relating to credit, store and charge cards still remain the largest category of debt. Unusually, credit card debt problems were down by 9%, while problems with overdrafts were up 7% on the same period in 2007.
In 2007, Citizens Advice Bureaux dealt with 5.7 million new problems, more than 1.7 million of which concerned debt. Debt is now the number one issue advised on in bureaux, accounting for nearly one in three of all enquiries, and CAB advisers around the country are dealing with over 6,600 debt problems every working day.
Perchard added: “If people have debt problems they should get help straight away. We cannot stress enough the importance of telling your creditors as soon as you have difficulties in paying – and they should be treating you sympathetically.”
As a reaction to growing debt issues in the UK, 81% of parents with children under 18 say that they are making a conscious effort to talk to their children about money matters in order to prepare them for adult life, according to Engage Mutual Insurance.
The insurer has revealed British parents consider talking to children about money facts to be more important than educating them on STDs, racism or religion.
Two thirds of parents say debt is the most common financial topic of parental education, followed by saving for the future.
The only life lessons to be considered more important than debts in children’s at-home education were drugs, personal hygiene and ‘the birds and the bees’.
Older parent are more likely than younger parents to be making a real effort to talk to their children about money matters. Engage predicts that this is due to their children fast approaching adulthood under-prepared. Over 70% of parents over 35 are making an effort to talk to their kids about debt, compared to just 57% of under 35’s.
A spokesman for Engage Mutual Assurance, says: “The fact that so many parents are prioritising talking to their children about money is a reflection of the increasing strain families are finding themselves under to make ends meet.
“In considering how they approach the subject of money with their children, we would encourage parents to involve them as early as possible.”
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