Secured loans could tackle the "spiral" of debt
13/12/2007Recent instability in the financial market will not deter consumers from running up high-interest debt on their credit cards, according to one expert.
A spokesman for Baronworth Investment Services (BIS) said this week that credit card users were facing future problems, which could be aided with a debt consolidation loan, due to reliance on their credit cards.
Colin Jackson, director of BIS, said: "A lot of people now are using their credit card to pay for their mortgage and that is the most awful situation to be in."
He added that people are putting themselves under unnecessary pressure from credit card lending - which often has a higher rate of interest than secured loans or homeowner loans - and that this can often lead people "into a spiral" of debt.
According to recent research from Credit Action, more people have turned to secured loans recently with total secured lending reaching over £1.1 billion by October this year - an increase of 10.5 per cent over the previous 12 months.
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