If you are struggling with high levels of debt and whilst it might not bring you great comfort, you might be surprised to learn that you are not alone.
Pepper Money, in partnership with YouGov, recently launched the seventh edition of their Specialist Lending Study. They surveyed more than 6,000 UK adults, indicative of a demographically representative sample of the British adult population.
It was uncovered that 15.16 million people have a history of adverse credit – missed credit payments, Defaults, CCJs, unsecured arrears, secured arrears or entered a Debt Management Plan.
Key findings highlighting levels of unsecured debt:
- 49% of people who’ve missed one credit payment say they have then gone on to miss further credit payments.
- 45% of people with adverse credit say their use of Buy Now Pay Later credit has increased in the last year. 17% say it has increased a lot.
- 30% of people with adverse credit have unsecured debt of more than £5,000. 17% have unsecured debt of more than £10,000. 9% have outstanding debts of more than £15,000.
- 43% say their level of debt has increased in the last year.
- 36% of people with adverse credit are concerned that their level of debt will impact their ability to get a mortgage in the future.
- 50% of people with adverse credit have never heard the term ‘specialist mortgage lender’
One way to get on top of your debts, is by raising capital with a remortgage or second mortgage to pay off the separate balances, consolidating them into additional borrowing secured against your property, offering more affordable monthly payments.
Restructuring finances requires careful consideration of the risks involved, as it may increase the overall amount that is repaid. Moving from unsecured debt to secured debt means offering your home as security for that debt.
However, it can also prove to be a vital lifeline for households struggling in the current environment to reduce their monthly costs.
Warning: your home is at risk if you do not keep up payments to your mortgage or any other loan secured on it.