Average debt levels have risen to an all-time high of nearly 140 per cent of income, twice the level it reached in the 1980s, the Financial Services Authority said yesterday.
“There is a risk consumers could be unprepared and ill-equipped for a weaker economic environment and hold an over-confident view about the future,” the organisation’s Financial Risk Outlook for 2007 warned. Figures yesterday showed that repossessions had risen 65 per cent in a year. Experts said homeowners are taking on huge levels of debts to get their first step on the housing ladder.
The UK’s total stock of personal debt has risen to £1.3 trillion, making Britain one of the most indebted nations in the world. More than 17,000 people had their homes repossessed last year, according to The Council of Mortgage Lenders.
Debt at all-time high as Britons borrow £1.3 trillion