Tuesday 19th of January 2010
The average British home with dependent children has over £90,000 still outstanding on their mortgage, a new report reveals, a figure which could highlight the wider state of household coffers.
With a mortgage deemed by many as an essential monthly repayment to make, other commitments such as credit and store card debt may be pushed on the backburner.
If you have increasingly found yourself ignoring credit card bills in order to find the cash for other repayments then you may want to start asking some questions on individual voluntary arrangements (IVA), which can help you clear your unsecured debt.
IVAs merge different credit card bills into one, more manageable, monthly repayment. With only one credit card balance to clear, you could find paying off your mortgage and unsecured debt is less of a financial headache.
The Scottish Widows study shows that people without children have less mortgage debt, with such individuals owing around £73,293. Britons without kids have managed to seriously lower what they owe, as their average mortgage balance stood at £77,500 last year.
Mounting personal debt could also mean that parents are unable to secure their family’s finances should anything unexpected occur.
The survey reveals that 62 per cent of Britons have not secured their future finances - this could be through life insurance or clearing debt with an IVA so their loved ones are not left with it.
"People are leaving themselves exposed to a lack of income should anything happen to the main breadwinner and large personal debt to repay on top of this could make things even more difficult," says Scottish Widows’ protection director Clive Allison.
Repaying personal debt such as credit cards, store plastic and unsecured loans through an IVA could strengthen the long-term financial standing of households should unexpected events like an illness or job loss occur.
By Hayley Jones
- House price rise 'may not indicate recovery'
- Equity release 'needs to be increased'
- Need for IVA help could increase as expert predicts reduction in lending
- Government announces 'breathing space' for those needing IVA help
- Lack of subprime lending creating need for IVA help, expert suggests
- Information on IVAs may increase in popularity following credit market calls
