Personal Debt Levels Hit New High
It seems that whilst everything in the UK appears to be in decline at the moment, there is one area of rapid growth, although this is not necessarily something we should be proud of.
The total level of personal debt in the UK has actually now exceeded GDP growth and is still increasing. Although the rate of growth of debt on loans and other types of credit has slowed to 4.1 per cent over the last twelve months, the total amount of money owed by individuals in the UK by the end of November last year was a staggering £1,456 billion, which shows an increase of £56 billion in just one year.
The total amount of lending based on secured loans and homeowner loans accounted for £1,222 billion and the rate of growth in this area has slowed, due to the credit crunch forcing banks and building societies to restrict their lending criteria.
Total consumer credit lending, which includes personal loans, credit cards and overdrafts, has increased by 5.2 per cent in the year to November, to reach a level of £234 billion. To break the figures down to an individual basis, the average level of debt is £9,600 per UK household, not taking into account mortgages, but if the figures are limited to those families who have an unsecured loan of some kind, this increases to £21,875.
Average debt in the UK including mortgage loans now stands at £59,670 and every adult owes on average £30,420. The average size of a mortgage is currently £104,058.
To put this into some kind of perspective, the level of personal debt in the UK is increasing by £1 million every ten minutes. Individuals will borrow an additional £154 on loans and credit cards and they will pay an incredible £252 million in interest just today alone!
The average amount of personal debt per UK household will increase by £6.30 today, 298 individuals will be declared bankrupt, or insolvent and 2,430 County Court Judgements (CCJ’s) will be issued today. I think I need a beer after that, could anybody lend me a fiver?
