One of UK’s debt management companies conducted a postcode analysis on the location of the 40,000 people in search for help with their debts. Results revealed London suburb Croydon to be the debt-worry capital of the UK, followed by Coventry and Nottingham.
The company’s director commented: “Right now we are being told that the economy is ‘out of intensive care’ but there are still a few years ahead where people will continue to struggle financially. Currently there are 2.5 million unemployed and many others who have had to take jobs that pay less than their previous roles.”
He also emphasized on the fact that despite the recovery process that some parts of the country undergo, debt will continue to be a problem as long as wage increases cannot keep up with the increase of living costs.
The fifth area with the highest level of debt help seekers in the past 12 months is Redhill in Surrey, part of London’s commuter belt. The birthplace of Margaret Thatcher, Grantham in Linconshire, occupies the seventh position.
The trend among those seeking debt help seems to have changed over the years. Initially, it was a solution mainly used by those on low income or living in rented accommodation, but now everyone – homeowners, young families, retired people – turn towards a debt solution to help them ease their struggle.
Ed Swain, Croydon public sector worker, interviewed by The Independent, presented his case, which is not in the least atypical among UK’s debt struggling people. It all began once he started to take advantage of bank’s offers (loans, credit cards), in order to spend on holidays, luxury items or cars. He thought that it was normal to do so. The thought of debt didn’t really bother him at first, he argues, but then, things took a turn for the worst: “In your mind when you’re spending it seems easy to think ‘I can pay that back monthly’. However there came a point where I could no longer afford the monthly payments along with all the other household bills.”
The continuous rise of living fees and no rise in income over the past few years made him unable to mentain his minimum payments and he fell into arrears. This had a great impact on certain aspects of his life, as he confesses: “I borrowed more money to pay off the debts and this ‘robbing Peter to pay Paul’ situation continued for four years, during which I had sleepless nights and my relationship with my family and loved ones broke down.”
He found a solution when turning to a counseling service which was offered through his employer. he entered a debt management plan and his creditors accepted that he paid less than he owed provided that he keeps with his new affordable payment schedule.
In order to show people that are struggling with debts that they should not be ashamed to talk about their problems and seek solutions, the debt management company has published the national debt map on their website.
Based on the postcode analysis, this is a top ten of UK debt hotspots: