LONDON: Shun doorstep lenders! That's the advice to Britons, who find them convenient to meet fund requirements.
The Housing Corporation has given an estimate that borrowers from doorstep loan providers end up paying 37 million pounds in interest alone during Christmas, the poorest of the poor being the worst victims. The corporation said its enquiries have revealed that such lenders charge as much as 600 per cent interest. It cited the instance of a loan shark in Birmingham getting convicted after charging interest rate of as much as 8,000 per cent earlier this year.
The corporation said people needing cash should seek help from housing associations, which can provide debt guidance, credit union services and help with benefits.
The corporation's chief executive, Jon Rouse said people tend to borrow during festival times, especially Christmas to meet their familial commitments. If they borrow from doorstep lenders, "they risk the roof over their heads in return for a day's happiness", he added.
The corporation put the number of people burdened with debts they acquired during last Christmas at 2.4 million.
It said taking out a remortgage on house property can be a viable option to free up vital funds.
The National Housing Federation is now partnering in the U.K.'s "Debt on our Doorsteps" campaign demanding government action to protect poorer families through a cap on the rate of interest lenders can charge, better access to bank facilities and advisory services.
Posted
on : Thu, 22 Dec 2005 20:05 GMT | Debt News
By : Mark Richardson
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