Renters may have "taken on too much debt"

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Renters may have "taken on too much debt"

Renters who have found themselves steeped in unsecured debt are now paying the price, according to the Council of Mortgage Lenders (CML).

Bernard Clarke, spokesperson for CML, made the assertion amid research conducted by the Bank of England that discovered ten per cent of the people who rent are facing unsecured loans that are worth more than their annual income.

Those who rent do not have the security of having equity from a property should they find themselves in financial trouble, even though renting is seen by some as the cheaper option.

When asked whether he believed it to be a surprise that one in ten currently have so much unsecured debt, Mr Clarke said: "I think what this highlights is the growth of unsecured debt, which of course affects people who have mortgages as well as those who do not.

"The rapid growth of unsecured debt has produced some well-documented problems for some people who have taken on too much debt."

However, the debt vultures are not just circling renters as Bank of England figures show a 7.7 per cent rise in debt levels for people with mortgages.

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