Adverse Mortgages UK

Credit cards are the biggest contributory factor in serious debt cases in the UK, a new debt survey has revealed.

The Debt Counsellors Annual UK Debt Survey 2006 revealed that more than 91 per cent of people who seek help with debt owe money on credit cards, with store cards coming in for particular criticism. Store cards were found to be responsible for 41 per cent of all serious debt cases in the UK.

John Porter, senior counsellor with the Debt Counsellors, suggested that too many consumers are using their credit cards inappropriately, allowing credit card balances to mount up.

"There's no doubt that credit cards can be useful to make purchases, especially with the advent of online shopping. However, too many people use them to supplement their income or spend beyond their means," Mr Porter said.

"Many people fool themselves into thinking they are dealing with their credit card debt by paying the minimum amount each month but the added interest simply negates these payments."

However, he also made a number of suggestions to help prevent consumer from letting their credit card debts get out of control.

He called on British consumers to pay off the balance every month to prevent interest from accruing, to keep an eye out for more advantageous interest rates and always to read the small print.

Credit card debt in the UK stood at £55.4 billion in August 2006, figures from Credit Action have revealed, with 74.6 per cent of UK credit card balances accruing interest, the British Bankers Association claimed.


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