Only Santa Should Be In The Red This Christmas

11th December 2006

Christmas could break the bank for the more than 6.6 million people already behind on payments, the Legal Services Commission (LSC) warned today launching its Christmas debt awareness campaign. The campaign asks shoppers to think of the debt they may be racking up ahead of January when the bills arrive. The LSC pays for legal aid, including debt advice, and last year calls for debt help to the Community Legal Service Direct phone line in January doubled the calls logged for December.

In 2006 debt became a more serious problem in the UK than ever as households struggled to cope with debt totalling �1.1trillion, that's more than �16,500 worth of debt for every man, woman and child in the UK.

6.6 million people reported being three months or more behind with payments on their regular commitments. Individuals declaring themselves insolvent have risen 95%� Bankruptcies are up by nearly a third. Home possession orders have jumped 66% and repossessions 47%�

The average personal debt of visitors to advice agencies has topped �30,000.

Only Santa should be in the red this Christmas in around 5,000 locations such as pubs, church halls, Christmas markets and job centres. Caroyln Regan, Chief Executive of the Legal Services Commission said:"It's difficult to avoid expense at this time of year but tackling debt problems early is the key to staying afloat. Keep track of your spending, know how much you owe and if you are in trouble call for help now. Getting help now can help you avoid bailiffs, eviction and disconnection from utilities in January.

Fifty percent of households with serious debt problems have an annual income of less than �7,500. That means Christmas debt can mean a choice between not eating or having the power cut off when January bills arrive." Pensioner, Arthur Finch (not his real name) couldn't afford to eat when his creditors pushed for higher monthly payments on his debts worth more than �30,000. He was threatened with a bailiff's visit when he told two of his creditors there was no way he could increase payments. He lives in sheltered accommodation and has no assets.

After getting free civil legal aid from the Legal Services Commission, Arthur * is back on top of his finances. "I never should have been offered so much credit. I can't afford it. I took the loans the bank offered me because Christmas is an expensive time. When I finally called an adviser I was actually frightened and upset. My creditors were pushing me for higher and higher payments, sending threatening letters * and on my pension there was no way I couldn't afford it. I'd already sent them my electricity money. I would recommend my adviser to anyone. She talked to everyone I owed money to and my bills came down to a fair level."

Tips for a debt free Christmas
Using credit or catalogues can be a good way of spreading the cost ofChristmas but you don't want to be paying for this Christmas this time next year.

Don't take on more repayments than you can afford in full within the next few months.

Don't be tempted to keep buying more, set a budget and stick to it.

Gas prices have gone up this year so make sure you budget accordingly. If you are on benefits or over 60 you may be eligible for help with your fuel bill. You might also be able to get a grant to help pay for heating and insulation improvements.

Make sure you know the penalties you might incur if you fail to pay your credit card bill. You could consider switching your balance to a 0% interest deal.If you are having problems paying, let creditors know. They may be able to extend the time you have to pay.If you find yourself in debt problems get advice.

Don't let the bills mount up unopened.

The earlier you get help, the easier and less stressful it will be.

The Legal Services Commission who operate in England And Wales issued this warning but figures apply equally to Scotland

For advice on Debt in Scotland go to -
www.adviceguide.org.uk/scotland.htm

Highland Council also run a Money Advice service that is also free of charge and is good place to start for any one in the Higland area with concerns about finances or debt.
See
www.highland.gov.uk/livinghere/consumeradvice/moneyadvice.htm

Tel
Inverness (01463) 228709
Wick (01955) 607752
Fort William (01397) 707005