The average level of unsecured debt experienced by each household has gone past the £6,000 mark.
Figures from The Money Charity indicate that the mean amount owed on things like credit cards, store cards and personal loans went up to £6,087 in January, having been revised to £5,990 the month before.
In total, outstanding personal debt was up at £1.439 trillion by the end of January this year, with mortgages making up £1.278 trillion of that. Unsecured loans still to be paid totalled £160.8 billion at that point, up £4 billion on the same point in 2013.
Michelle Highman from The Money Charity suggests that rising prices could be to blame, noting that "consumers may be finding that once they have paid their priority debts and covered basic living costs they don`t have the additional funds to pay their unsecured loans; and as a result continue to incur high interest costs".
The stats show that total interest payment on personal debt over the year to January this year sat at £59.3 billion. Dividing this between the UK`s households, this means that each one would need to make £2,245 in interest repayments alone, before servicing the original debt.
Finding a cheaper unsecured or secured loan could help cut the unsecured portion of this interest payment and leave you with a single credit repayment to make each month. Please ensure you are aware of the total amount you pay back as even if the payments are less the total interest you pay over the term could be notably more and if you require a secured loan to raise the money, then you must think carefully before securing debts against your home.
First Choice is tied to a selected number of secured lenders, if you are interested in our secured loan options for you then call us on our mobile friendly 0333 003 1505 or from a landline on 0800 298 3000, alternatively visit firstchoicefinance.co.uk.
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