Debt consolidation loans become more popular, as average consumer debts increase
British households have amassed an average unsecured debt in excess of £10’000, reveals a new report.
According to recent market analysis, compiled using the most up to date credit management statistics, personal unsecured debt has rose by approximately 6% in the last 12 months alone.
Worryingly however, the report also makes mention that the stats do not take any mortgage or secured personal debts into consideration, suggesting that if all such debts were also encompassed within the figures, the average British household would be indebted by more than £70,000.
In addition, it has been discovered that the typical rate of interest repaid by consumers on their debts (both secured and unsecured) has also increased by some degree over the last few years. British consumers are now thought to be paying close to £4000 per annum in interest alone, representing a rise of more than 16% since Jan 2006.
To complement the findings, loan industry professionals have reported a surge in demand for debt consolidation loans over the past 12 months. Reports indicate that consumers are borrowing an average of £16,000 to consolidate all of their unsecured debts (including interest), with the average repayment term exceeding 8 years. Debt consolidation loans are now the most popular form of loan product, with their popularity set to increase further still throughout 2008.
