In the wake of credit crunch in the market, many Britons are using credit cards to pay off their mortgages and rents.
London (longdogfinance) October 19, 2007: Thousands of Brits have been facing the credit crunch with their credit cards when they should have gone for some more sustainable ways of solving their financial worries. Many people have been hit by the turmoil in the credit market, frequent interest rate hikes and expensive housing costs.
Home charity Shelter found that many young people, particularly the first-time buyers, are turning to expensive forms of credit in a desperate bid to stay on the housing ladder. However, credit cards are not a permanent solution to their debt problems. Such people should think about the long-term consequences of taking out unmanageable loans.
Shelter’s chief executive Adam Sampson said: “For many people trying to keep a roof over their head, desperation is driving them to short-term, high-cost borrowing. Ordinary people are being forced to seek more risky and expensive ways to stave off the threat of eviction and repossession.”
In the last one month, the interest rate for personal loans has risen by up to four percent. Mortgages and home loans have also become expensive after the Northern Rock and credit crunch episode.
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