Consumers using credit cards to pay bills

19/09/2008

As the daily cost of living rises, homeowners are resorting to paying household bills and even mortgage payments with their credit cards in order to help ends meet according to a leading UK debt management service, Payplan.

According to Payplan, of the 8,200 people who contacted them in the past month, half of these consumers said that they had no choice but to resort to using their credit cards to help pay a utility bill or mortgage payment.

With recent rises in inflation, homeowners are left to struggle with expenses. With the average family monthly income of £2,200, after deducting bills and other household expenses, there is not much if anything left.

“After living expenses, there isn’t enough money in the kitty to pay off their debts,” said Managing Director of Payplan, John Fairhurst.

“Today the average homeowner calling Payplan for help owes over £40,000 in unsecured debt, compared to the average £27,000 owed by renters. Any inflationary price increases have a catastrophic effect on their budgets.”

 Small debts previously dealt with by juggling credit are now becoming unmanageable much faster.”