Latest data from StepChange has found that two in five (41%) have found it difficult to keep up with bills and credit commitments in the last few months.
The debt charity data has also found that, among those with a mortgage seeking debt advice, mortgage arrears have been steadily rising this year. The average arrears per StepChange client now standing at £9,657, a 68% increase year-on-year.
Whilst one in six (16%) have used credit, loans or an overdraft to make it through to payday. This compares to 11% of the wider population
Richard Lane, Chief Client Officer at StepChange, said “Even with an expected fall in the Bank of England’s base rate, we’ve not seen interest rates come down as quickly as they shot up in 2022 – and as we can see among our own clients in problem debt, this has taken its toll. Thousands of mortgage holders have faced new fixed rate deals over the past year or two with monthly payments eating up a much larger proportion of their income. This has had a knock-on effect on people’s ability to keep up with bills and repay other debts as they prioritise keeping a roof over their head.
“The effect on private renters can also not be underestimated – many landlords have passed on higher debt servicing costs to tenants, making their rental payments increasingly unaffordable.
“For anyone struggling with ongoing mortgage payments and housing costs, or worried about debt – don’t hesitate to reach out to your creditors and ask for help. Mortgage lenders have a regulatory responsibility to support borrowers who’re struggling, and may be able to provide forbearance. StepChange can also support with free and impartial debt advice including mortgage debt advice to those in difficulty.”