As many as 6.5 million Britons have been forced to consolidate their debts in the past three years.
According to new research by Moneyexpert.com, 6.5 million people are actively taking control of their debt problems
The research shows that 1.29 million of those questioned have consolidated debts of over £20,000 that were run up on store cards, credit cards, loans and overdrafts. The study also showed that young people were most likely to have consolidated, 23 per cent of 25-34 year olds admitted to moving all their debts to one lender.
Moneyexpert.com urges people to take control of their debts, according to its research; Moneyexpert.com has seen a significant rise in the demand for secured loans over the last 6 months.
The financial comparison website has seen an 85 per cent increase in homeowner loan applications for the quarter ending January 2008, compared to the quarter ending October 2007. Moneyexpert.com suggests that the rise could be due to an increase in people consolidating debts of over £20,000, who are more likely to have loans secured against their homes.
The research also showed that the majority of those who have consolidated debts in the last three years owed up to £5,000, and 25 per cent of participants had owed between £5,001 and £10,000.
Sean Gardner, Chief Executive of MoneyExpert.com, said: "Anyone who is juggling a range of debts with money owed on credit cards, store cards and loans should be acting to get their debts under control.
"It is encouraging that so many people have taken action as you can make significant savings by moving all your debts to one place.
"With average standard credit card rates at 17.01 per cent compared to average unsecured loan rates of 8.44 per cent it is clear that borrowers can cut their monthly interest bill by moving," Mr. Gardner continued.
Despite the control that consolidation allows, Moneyexpert.com warns that it must be seen as more than just a way to keep peoples heads above water. Mr. Gardner concluded:
"It is crucial that borrowers see consolidation as a wake-up call to get debts under control. It shouldn’t be something you keep on doing simply to tide you over from year to year."
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