Winchester families shackled by £6m in 'problem debt'

Credit card repayments contributed to millions of pounds in 'problem debt', affecting 1,296 families in Winchester

Credit card repayments contributed to millions of pounds in 'problem debt', affecting 1,296 families in Winchester

First published in News Hampshire Chronicle: Photograph of the Author by , Reporter

FAMILIES in Winchester are shackled by almost £6 million in 'problem debt' from payday loans and credit card repayments, according to a new report.

Thousands of households across Hampshire are facing a "toxic cycle of debt," and children are becoming stressed and anxious over difficult family finances, according to the report by The Children's Society and StepChange Debt Charity.

Problem debt, primarily caused by credit card repayments, rising bills and payday loans, affects 1,296 families and 2,255 children in the constituency. They owe a total of £5,788,294, meaning each family is burdened with an average of £4,466 in debt.

Households in Eastleigh owe more than £10 million, with 2,403 families and 4,181 children struggling to repay problem debt.

In the Meon Valley, 1,937 families owe a total of £8,654,342, affecting 3,371 children.

Almost £6 million is owed by 1,283 Romsey families, although this figure also includes parents in north Southampton.

The figures, published in The Debt Trap: Exposing the Impact of Problem Debt on Children, do not include housing costs such as rent increases or mortgage payments.

Nine in ten families in problem debt said they have had to cut back on essentials like food, clothing and heating to keep up repayments.

More than half of children in these households say they worry about their family's finances. This leads to stress, anxiety and even bullying, according to the report.

Anne Macpherson, of family support charity Home Start Winchester, said that parents are struggling with payday loans, rent arrears and repayments to shops such as Bright House, which charge weekly fees for furniture and appliances at a huge mark-up.

“We had one family paying over £70 a week just for a sofa and an oven," she said. "That's huge for people on benefits.

“The problem with Winchester is that it looks so affluent. Very wealthy people are going about in their huge cars and the shops are very expensive - but our families suffer as a result.”

Winchester was named Britain's second least affordable city in March. An average house in the city costs nine-and-a-half times the average local wage, a study found.

Jenny Meadows, chief executive of Winchester District Citizens Advice Bureau, said that debt troubles from utility bills and credit cards have been consistent since the recession but that payday loans are becoming more widespread.

She said: “Before, payday loans were used to buy cars or washing machines - now they're being taken out for people just to live, to buy food and clothes. Because of that, we have seen a big increase in use of food banks in Winchester.”

The authors of The Debt Trap are calling on the government to offer more support for families and children struggling with problem debt.

Comments (1)

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1:29pm Thu 28 Aug 14

rick20 says...

When times get tough more and more people are turning to payday loans. A payday loan is a simple concept: you borrow money and pledge your next paycheck to repay the loan. Unfortunately the interest rates and fees on these types of loans are obscenely high. There are so many lending services that the customer can’t choose the proper one. Apply for wage day advance on the web once you are in a doubt and get all exhaustive information about the loans as well as immediate help.
When times get tough more and more people are turning to payday loans. A payday loan is a simple concept: you borrow money and pledge your next paycheck to repay the loan. Unfortunately the interest rates and fees on these types of loans are obscenely high. There are so many lending services that the customer can’t choose the proper one. Apply for wage day advance on the web once you are in a doubt and get all exhaustive information about the loans as well as immediate help. rick20
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