Furthermore, property repossessions have fallen by 8 a day over the past month. Landlord possessions orders have fallen by 13 a day, and mortgage possession orders by 2. Citizens Advice also reports debt issues are down 2% on the same month last year.
These positive signs come as interest rates begin to rise. After stimulation from the Bank of England’s first base rate rise since November last year, instant access savings accounts rates have also risen for the first time in almost 2 years.
However, this is a rise of only 0.01% – to 0.2%. The Bank of England base rate on the other hand, has risen to 0.75%. In terms of average interest rates on credit, a loan for £5,000 has fallen to 7.79%, £10,000 loans to 3.76% and overdrafts to 19.68%. Meanwhile, credit card rates have rocketed to 18.30%.
Interest rates for savings will need to start to match the good intentions of the Bank of England base rate rises for debt growth to continue to slow, and savings rates to actually grow.
Michelle Highman, Chief Executive of The Money Charity said“It is promising to see unsustainable debt levels beginning to slow over the past few months. Unmanageable levels of debt make staying on top of your money impossible. So it’s good to also see repossessions drop slight too. Debt will always be a part of life, but it does not have to be an ever increasing hinderance. If you are experiencing debt problems, please take action to get back in control of your finances.”