Loans -
2008 to be a hard financial year - 22/01/2008
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According to Credit Action, a charity offering advice about money management, 2008 is going to be a hard year financially. After several hikes in mortgage interest rates last year, the pressure is expected to continue. Chris Tapp, the director of national money education charity remarked: "If we look at the cost of credit going up and being harder to come by as well, in 2008 I think people's general financial situation is going to squeeze".
The news sparked fears that, failing to keep up with personal loan repayments and mortgages, more and more people would apply for an individual voluntary arrangement (IVA) to try and manage their debts. Recent statistics released by the Insolvency Service showed that there were 26,956 individual insolvencies in the second quarter of 2007, which although a decrease of 8.1% from the previous quarter, was a 4.2% increase when compared to the same period in 2006.
Mr Tapp did not necessarily believe this would lead to a rise in IVAs as changes to the regulations mean fewer are now being set up.
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