Average Brit is over £30,000 in debt
International accountancy firm, PricewaterhouseCoopers, have said the average Briton currently owes £33,000, compared with £17,000 in 2000, meaning families are now nearly twice as deeply in debt as they were just 7 years ago.
The rise is primarily due to escalating property prices and huge monthly mortgage repayments and experts are warning that the global credit squeeze means tough times ahead.
Lenders have tightened their lending criteria so families will find it harder to borrow money for Christmas say the accountants. Barclaycard, for instance, are refusing at least 50% of new customer card applications.
Richard Thompson of PricewaterhouseCoopers said there are tough times ahead for both consumers and credit card companies. Banks are continuing to take action in response to the increase in consumer debt by tightening their credit acceptance policies.
In addition, there could be an increase in the amount of insolvencies next year. Consequently, this will lead to a rise in the amount of bad debt losses suffered by credit card companies and others.
The situation will deteriorate due to the fact that 1.4 million homeowners will see their cheap fixed rate mortgage deals expire in the next 12 months. This will result in an average of £140 a month to mortgage bills for those who fail to find a cheaper new deal.
Total personal consumer debt in the UK, including mortgages, has hit £1.3 trillion amid a consumer spending boom fuelled by easy credit said PricewaterhouseCoopers.