Unsecured Loans & Bankruptcies

The UK is facing a problem of increasing outstanding unsecured loans. It is estimated that 3 million people in the UK have an outstanding debt of more than £10,000.

(PRWEB) January 1, 2006 -- The UK is facing a problem of increasing outstanding unsecured loans. It is estimated that 3 million people in the UK have an outstanding debt of more than £10,000. This has resulted in a fall in consumer spending. An interest rate cut in August 2005 has resulted in an increase in homeowner’s loans. There is a positive effect of this. People are using their homeowner’s loans to consolidate their unsecured loans.

Credit card dues have a major portion of outstanding unsecured loans. More than half of the credit cards in Europe are issued in the United Kingdom alone. There is a strong tendency among the British people to use credit cards while they go for shopping.

It has been reported that UK borrowers are finding it difficult to repay their unsecured personal loans. As a result of this, there is a rise in the personal bankruptcies in the UK. Most of the bankruptcies are being declared by working people rather than by unemployed people. This shows a gloomy picture of the British economy.

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