September 26, 2005

It is being said that more and more people are going to fall further and further in to the debt trap and will find it an almighty struggle to pull them free from it.

This is a warning from Lloyds TSB who is the biggest unsecured lender in the market and are worried that people with large credit card debts and loans are finding it far more difficult to repay what they owe.

This warning follows hard on the heels of other major lenders who have already stated that they were finding people having difficulties in paying back the debt that they have built up, with these lenders being Barclays, HSBC and the Royal Bank of Scotland and with Lloyds TSB now joining in the chorus of lenders who are saying this, then maybe it’s about time the British public should take heed.

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The reason for this, has been put down to the rate rises that were imposed over the period of the last 18 months and an increase of the amount of bad debtors, has been seen in both and loans, in a 50/50 split between both, according to Lloyds TSB.

Lloyds also have said that the growth in which we have seen in consumer spending, over the last few years, as seen a marked fall in the first half of this year, as people are not only worrying about their debts, they are also looking at the economy that has a lot of consumers thinking about job losses, thus leading to them in trying to structure their finances encase of any unemployment problems arising.

It has been stated that if unemployment stays low, then the chances are that bad debts will be able to be managed and contained, but should the retail industry start to feel the pinch, as more and more consumers tighten the purse strings, this could lead them to cutting back on staff and a rise in the unemployment figures and the chances of bad debts taking an upturn will be very high indeed.