Secured loans as an alternative to high interest lending
28/02/2008Many consumers are opting for high-cost credit in a bid to control their finances, one expert has suggested.
According to a spokesman for Credit Action, the effects of the credit crunch have forced many people into borrowing from high interest lenders as consumers struggle to get on top of their debts.
Chris Tapp, director of Credit Action, said that people's spending habits have generally become more conservative in the wake of recent financial instability but added that there were still a number of people borrowing from costly lenders - such as high interest credit card providers.
"People in the past may have been able to obtain high street credit cards and these types of discounted buying, and they may find now that as people tighten this lending criteria they are forced to look elsewhere for higher cost alternatives," he said.
Many people find that tackling their existing debts and high interest credit card repayments with a secured loan offers them a convenient and affordable option.
According to figures from Debt Help UK, British consumers currently have around 5 times the average amount of credit cards compared to their European counterparts.
 © Adfero Ltd
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