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Cheap unsecured loans may become hard to get
London (go4ukloans) April 17, 2006
A market analysis company said that indebted borrowers may find it hard to get comparative cheap credit as lenders begin to worry more about bad debts.
Datamonitor said that the increasing amount of unsecured debt was beginning to affect lenders adversely and they have been forced to increase their provisions for bad debts.
Karina Purang, financial analyst at Datamonitor said that due to increased indebtedness on part of borrowers and lenders adopting a more precautionary approach to lending, consumers with a less than good credit history may find it more difficult to get access to cheap credit.
The figures from the Bank of England also reveal the growing trend. The amount of unsecured debt that banks had to write off rose from £2.9 billion in the first three quarters of 2004 to £3.7 billion over the same period in 2005. This increase of 27.6 per cent is likely to make lenders more cautious when dealing with borrowers who already have bad credit against their names.
Expert opinion: With growing indebtedness, the borrowers are finding it tough to honour their debt commitments. This has forced the lenders to adopt more cautious approach. The lenders are likely to offer unsecured loans at comparatively higher rates to cover the risk of increasing bed debt problems that they are facing.
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London (go4ukloans) April 17, 2006
A market analysis company said that indebted borrowers may find it hard to get comparative cheap credit as lenders begin to worry more about bad debts.
Datamonitor said that the increasing amount of unsecured debt was beginning to affect lenders adversely and they have been forced to increase their provisions for bad debts.
Karina Purang, financial analyst at Datamonitor said that due to increased indebtedness on part of borrowers and lenders adopting a more precautionary approach to lending, consumers with a less than good credit history may find it more difficult to get access to cheap credit.
The figures from the Bank of England also reveal the growing trend. The amount of unsecured debt that banks had to write off rose from £2.9 billion in the first three quarters of 2004 to £3.7 billion over the same period in 2005. This increase of 27.6 per cent is likely to make lenders more cautious when dealing with borrowers who already have bad credit against their names.
Expert opinion: With growing indebtedness, the borrowers are finding it tough to honour their debt commitments. This has forced the lenders to adopt more cautious approach. The lenders are likely to offer unsecured loans at comparatively higher rates to cover the risk of increasing bed debt problems that they are facing.
Other Related News:
