3.2 MILLION BRITISH HOUSEHOLDS FAIL TO MAKE THEIR MORTGAGE, LOAN PAYMENTS AS COST OF LIVING RISES

Wed 08 October 2023:

Around 3.2 million adults have missed some type of major bill payment in the last two years, according to new research.

The Mortgage Lender has found six percent of the adult population in the UK have missed either a mortgage payment, debt repayment, rent or energy bill, The Express reported.

This comes amid the cost of living crisis which has resulted in interest rates and energy bills skyrocketing.

As a consequence of this, four in 100 adults have admitted to having missed multiple payments.

Young adults are more likely to have experienced financial difficulty throughout the pandemic, as the age group most affected by job instability.

Some 11 percent of 18-34-year-olds missed at least one usual payment in the past two years.

This is nearly four times the amount of over-55s and six percent of young adults have shared having missed multiple payments.

Missing multiple payments could have a serious adverse effect on someone’s credit score which may prevent them from getting a mortgage or loan in the future.

Based on The Mortgage Lender’s research, here is a breakdown of the various payments people are failing to pay:

40 percent missed a utility bill payment

27 percent missed paying their council tax

25 percent missed their rent payments

23 percent missed personal loan repayments

Seven percent missed mortgage repayments

Peter Beaumont, the CEO of The Mortgage Lender, broke down why mortgages and other repayments are hard for people to pay off at this moment in time.

He explained, “The past two years have impacted many people’s jobs and salaries, putting a squeeze on household finances, and with the rising cost of living there is even greater pressure on the nation’s finances.”

“This can all lead an individual to miss a regular payment which then could have a knock-on effect on their access to credit down the line,” he added.

The mortgage expert called for better support for households struggling with repayments, particularly homeowners.

Beaumont added, “In such a volatile economic climate, it’s important that more people are prevented from falling down a rabbit hole of financial difficulty.”

“The lending market needs to become better equipped to deal with the greater quantities of people who are emerging from the pandemic with adverse credit histories,” he said.

“Rather than penalising people for the consequences of an unprecedented event, the industry should be working together to support those who’ve missed payments so that people, especially aspiring homeowners, aren’t locked out of the market,” he added.

SOURCE: INDEPENDENT PRESS AND NEWS AGENCIES

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