/24-7PressRelease/ - LONDON, UK, March 14, 2008 - Credit crunch has made the life of Britons no more all light and honey. According to a survey, an average Briton spends the first 70 days of the year's working just to clear interest on credit card and loan debt he owes. The figure was 39 days in the last year.
In the last year, the volume of personal loans in the UK increased by 10 percent. During this period average levels of payable interest have increased by over 6 percent. The amount of personal debt is now 9.8 billion pounds and interest rates on personal loans are 0.5 percent higher as the credit crunch takes its toll.
Britons pay almost 1.5 billion pounds in interest payments alone. Little respite has been witnessed in the credit card segment as the credit card debt, has declined slightly, to 54.9 billion pounds from 55.6 billion
Personal loan rates have increased by up to 4 percent in recent months and lenders are also tightening their criteria on mortgage and unsecured debt. In the last six months, the number of rejected mortgage applications surged by almost 60 percent. Although the Bank of England has cut the base rate twice to the current level of 5.25 percent, lenders are reluctant to offer new loan plans to the borrowers. As a result, fears are growing that more and more consumers will encounter serious debt problems.
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