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Easy conditions 'lead to debt'

Easy conditions 'lead to debt'

• Pay off those credit cards with a remortgage or loan

 

People are struggling to pay back loans because money is handed out too easily to them by service providers, it has been claimed.

Consultancy Thomas Charles noted that this has been happening for a long time and consumers get hit with debts because checks are not stringent enough.

Yet in the present economic climate, it suggested, it is harder for individuals to give back the credit because of the rising price of essential living costs.

As a result, people are getting more credit, with a card being used in order to repay other loans that they already have, managing director James Falla asserted.

He commented: "I think that kind of thing is just going to continue and we will see perhaps more people not being able to repay the money they have borrowed."

Mr Falla added that in past times banks have not got their money back due to the leniency of the criteria they have in place.

Just eight per cent of people were asked last year to provide details of their income when applying for credit, uSwitch.com has said.

Your home may be repossessed if you do not keep up repayments on your mortgage.

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