Using credit to create a smoke screen of apparent wealth has been a huge contributing factor to the current discomfort being felt by many individuals who have fallen prey to the ‘buy now pay later’ mentality. From clothes stores to car companies, credit has been used to lure countless numbers into living the lavish lifestyle without actually having the pounds to make the purchase.

It appears this era is finally coming to an end as the companies who once offered the credit are feeling the gripe of their supposed generosity. With ’s on the increase, creditors are losing more and more money as rather than default on payments; individuals are wising up and calling their creditors to account for their not so honourable generosity. As these IVA’s are legally binding people are having up to 65% of their debt written off leaving the lenders to pick up the slack. Clearly this was not the plan for the creditors, they would much rather charge for missed payments and watch the potential amount owed to them increase over time rather than decrease as was anticipated by the customer.

The courts and the powers that be are sympathising more often than not with the customer especially when the interest rates are proving to be extortionately high, showing the creditors to be taking horrendous advantage of the ignorance and yes greed of their supposedly ‘valuable’ customers.

It appears the lenders too were greedy and by focusing on the financially challenged and credit crippled they have in fact contributed to their own downfall. Government legislation has been written up to protect the vulnerable from preying providers, who use their elevated position to invite and then intimidate the unsuspecting. Once the customer is safely secured with the squiggle of their signature the lender’s demeanour becomes demonising as they harangue and harass hoping to extract the very money they knew would be difficult to obtain especially if the rate rockets after the initial ‘interest-free’ period.

What does that say about the lenders and their intentions and more importantly what does it mean for individuals looking to use their credit to consolidate their numerous debts? Should you rule out the option of a loan to make your life that little bit easier, or should you continue to allow your purse strings to pinch until the amount is paid off?

The latter option is hardly viable especially if your purse is bursting at the seams and threatening to explode its contents in a messy fashion all over your credit plate. Sean Gardner of MoneyExpert.com urges individuals to not rule personal loans out altogether; rather he states that "There are still competitive rates out there, particularly for people with good credit records".

With those wise words it is important you shop around to get the best deal as consolidation is still an advisable step for those that have simply bitten off more that they can chew or for those that just want to get their financial affairs in order. Streamlining your accounts through consolidation is advisable if control of your credit is your intention, if  however it is more about getting extra funds for that ‘dream holiday’ or for that once in a lifetime purchase, perhaps a few more moments pondering is the way forward.

For "Those in muddier” financial “waters” borrowing is still an option however they are warned that they “may have to pay more than they would have done even three months ago" Sean Gardner states. With interest rates steadily increasing from an average of 10.62% to a huge 11.4% in a short 3 months despite the Bank of England making two recent interest cuts it is truly advisable to reflect on your current situation before obligating yourself to yet another credit agreement with yet another lender.