2m pay for home on cards

6 January 2011

A family

More than two million people have used credit cards to pay their mortgage or rent, an increase of almost 50 per cent in a year, Shelter research reveals today.

The YouGov poll in August 2010 asked 2234 people in Great Britain if they had borrowed money on their credit card to pay their rent or mortgage in the last 12 months. Six per cent of respondents said yes, compared to just four per cent in November 2009, suggesting a national figure of over two million people.

Many of these people could be starting the New Year facing the risk of homelessness. Not only can defaulting on credit card payments lead to repossession in very severe cases, but just one single thing - like a bout of illness, a rent increase or drop in income - is all that’s needed to push people into a spiral of debt and arrears that can lead to the loss of their home.

Shelter is urging anyone using credit cards in this way to get advice on how to manage your debts.

Shelter’s Chief Executive Campbell Robb said: ‘Our research brings into sharp focus the daily struggle faced by millions of people across the country to keep a roof over their head.

‘This is a totally unsustainable situation and one which we fear could see thousands more families pushed into the spiral of debt, eviction or repossession and ultimately homelessness'

‘It’s vital that every single person using credit cards in this way takes action to get themselves out of debt and seeks urgent advice from organisations like Shelter, to ensure they don’t lose their home.’

Martin Lewis of MoneySavingExpert.com said: ‘For all but the seriously financially savvy, using credit cards to pay rent or mortgages is a mistake. After all, you’re simply paying off one debt with another and that isn’t any type of solution.

‘If you’re doing it because you can’t afford to pay your housing costs, lumping up the borrowing is never the answer – far better to seek help as soon as possible and start managing the problem.’

‘When it comes to getting help for those in debt crisis, there is a wonderful range of non-profit advisors out there, whose information is based purely on what’s best for you, not on pushing their own profits. I would urge people to seek help from organisations like Shelter - it should stop a few sleepless nights.'

Get help and advice

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