Loan payments missed by 10% of borrowers

One in ten borrowers in the UK have missed a repayment on their personal loans, mortgage or credit cards over the past six months.

A survey by Moneyexpert.co.uk found a significant number of consumers are under increasing financial pressure from rising bills and the increasing cost of finance.

Around five million finance related bills have been missed in the past six months, and hikes in mortgage rates, expected this week, are likely to put further pressure on borrowers.

Credit cards formed the bulk on missed payments, with around four million admitting they have missed at least one payment.

“The credit crunch is having a painful effect on households who are struggling to meet their financial commitments,” comments Sean Gardner, director of MoneyExpert.co.uk.

“Interest rates may have been pushed down through 2008 but increased pressures from rising food and energy bills mean consumers are struggling to keep their heads above water. One late payment doesn't represent a financial meltdown but when it becomes a habit there's real room for concern.”

Though inflation concerns are easing as the price of commodities falls, mortgage lenders are likely to increase their rates as inter-bank lending becomes more expensive, increasing the pressure on cash-strapped consumers.

The Bank of England is under intense pressure to cut interest rates when it meets this week, with some speculating it might make a 0.5% cut following a month of financial turmoil.

If you would like to comment on this story, contact:

John Bakie
Tel: 020 7484 9805
e-mail: John.Bakie@incisivemedia.com