Latest Debt News
Doorstep loans not the answer to debts
20/12/2005 14:40:00
The Housing Corporation has warned that some of the UK's poorest families could be plunged into greater financial difficulty by doorstep lenders this Christmas.
The organisation expects £37 million of inflated interest payments to be made during the festive period as people look for a quick, but ultimately costly, fix to their debts.
The Housing Corporation shows that an average doorstep lender would offer 497 per cent as a typical interest rate, while earlier this year one loan shark in Birmingham was convicted after offering a ridiculous 8,000 per cent interest rate.
Jon Rouse, chief executive of the Housing Corporation, commented: "At Christmas, every parent is under the same pressure to make it special for their children.
"But if they borrow from doorstep lenders, they risk the roof over their heads in return for a day's happiness."
Mr Rouse added that debt advice offered by housing associations would be crucial to helping people get through any financial muddle they might find themselves in.
"Social landlords like housing associations can really make a difference, by helping financially excluded residents manage their money around Christmas and offer a real alternative to doorstep loans at shocking interest rates," he said.
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