Debts – Top Facts You Need to Know
The world of debts and debt collectors is not widely understood. That is not surprising as many people who experience debt do not like to discuss it. Many people feel alone when in debt but that could not be further from the truth. Debt is everywhere; it is just that it is often known by different names. In private finance for example, a mortgage is debt. A car loan is debt and so is a credit card balance or an overdraft.
The world of business could not function without debt. Asset finance, leveraged buy outs, trade credit and commercial loans are all just debt. Governments too would find it hard to work without debt. Government gilts, securities and bonds are all debt. The difference between what a government gets from tax and other sources and what it spends is called the deficit and that contributes every year to a growing national debt.
Even governments sometimes need debt help, as has been seen recently with some European countries. Debt then is all around but here are five facts about debt and five facts about debt collectors which may surprise you.
Five facts about debts in the UK
Banks wrote-off £4.5 billion of loans to individuals in 2012. In the last quarter they wrote-off £999 million, of which £469 million was credit card debt, amounting to a daily write-off of £10.92m.
28 million card transactions were made every day in January 2013 with a total value of £1.373 billion.
The average household debt excluding mortgages was £5,998 in February 2013. This has increased from £5,992 in January.
On February 2013 figures, total interest repayments on personal debt over a 12 month period reached £60.6 billion. This is equal to £166 million a day. UK households would have had to pay an average of £2,299 in annual interest repayments.
Modest good news is that consumer credit lending stood at £158 billion at the end of February 2013. This is down slightly from £159 billion at the end of February 2012.
With the rise in payday loan debts it is not surprising that more consumers are also seeking payday loan debt help.
Five facts about debt collectors in the UK
The Office of fair Trading (OFT) has issued guidelines to debt collectors, including:
Debtors should be treated fairly without aggressive or inappropriate practices.
Debt collectors must be transparent in their dealings with the public. Any information should be clear and not misleading.
Consideration should be given to debtors experiencing difficulty, providing them with reasonable time and opportunity to repay debt.
Debt collectors should act proportionality, taking into account the debtor’s circumstances and considering the effects of any action on the debtor.
Debt collectors should establish clear and effective procedures for identifying and dealing with vulnerable debtors.
Clearly these guidelines give hope to those in debt trouble and knowledge of these guidelines and the help offered by payday loan debt consolidation services could take some of the immediate pressure off of those experiencing issues with debt.
1st Point Debt Solutions offers debt management solutions to help you resolve your debt problems. If you require help on your payday loan debt, please visit – www.1stpointdebtsolutions.co.uk