Demand for fuel bill debt and mortgage arrears help rises

Demand for help with mortgage arrears and energy bills is growing, Citizens Advice reports.
 
The advice charity has seen a 35 per cent rise in mortgage and secured loan arrears problems over the last 12 months – with 77,324 new enquiries since October 2007.
 
Over the last three months these was a 51 per cent rise in mortgage and loan enquires on a year ago.
 
Since the start of the year gas and electricity bills have risen by 43 per cent to an average of £1,307 – as such Citizens Advice has seen a ten per cent increase in fuel debt problems over the last three months.
 
The biggest source of debt problems remain unsecured loans - on credit cards, personal loans and store cards – covering 35% of all the debt problems handled. However, there was a four per cent drop on last year.
 
David Harker, Citizens Advice chief executive, said: "To prevent this situation worsening, it is vital that mortgage lenders and fuel companies do everything in their power to help people in arrears to come to a workable solution over repayment arrangements, rather than piling on extra charges.
 
"All creditors should treat borrowers in arrears fairly and sympathetically, negotiate with borrowers in trouble and only use court action for mortgage arrears as a last resort."
 
He advised anyone who is worried about debt should seek advice straight away.
 
"Get help from a Citizens Advice Bureau, or other free independent advice agency, who can help you work out payment options, check you are receiving all the benefits you are entitled to and help you claim any money that could off-set your costs," Mr Harker said.
 
"If you are falling behind with payments on a mortgage or secured loan you should speak to your lender straight away.
 
"Lenders should negotiate with borrowers, but if you are having problems, make sure you seek free, confidential, independent advice without delay."
 
Mr Harker added: "Receiving court papers doesn't mean that you are automatically going to lose your home. Getting advice, even at a late stage, can help the majority of people come to a workable agreement with their mortgage lender and can make all the difference between saving or losing their home."
 
The biggest source of debt problems remain unsecured loans - on credit cards, personal loans and store cards – covering 35% of all the debt problems handled. However, there was a four per cent drop on last year.