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Ahead of the FCA's guidelines on the fair treatment of mortgage borrowers who fall behind on payments, due to be published later this week, prepaid card provider icount has revealed that one in five Brits have had to use a credit card to pay their mortgage or rent over the last 12 months. With so many people falling behind, help would clearly be appreciated.
The statistics further show that men are twice as likely as women to put their mortgage payment or rent on the plastic, with one in three Brits pointing to unexpected bills as the main cause for arrears. Another 33% point to gaps in Universal Credit benefit payments as the main reason for not being able to pay on time.
Overall, the top five reasons are: general living costs, benefit payment gaps, unexpected bills, changing jobs and prioritising other debts. "The survey data highlights that the number of missed payments is rising across all age groups," commented Samuel Mond, MD of icount. "This, combined with the changes being introduced on the 6th May should, in effect, help to educate all in the importance of these essential payments and go some way to reduce the number of people falling behind with mortgage payments."
In prioritising debts, people may look at the higher interest rates on credit cards and put them ahead of mortgage payments in the queue, but this is a dangerous gamble. Falling behind on your mortgage payments could very well see you out of a home, with the same risk attached to missing rent. While credit card debt is certainly a worry, losing your home could see you in much more trouble overall.
To help those who are struggling with debt, we've got a guide with steps that can help you get yourself out of it. Don't hesitate to contact a debt charity, either, if you can't see an end to debt on your own. And, if you do have to pay your mortgage or rent on plastic every once in a while, make sure you find the best possible credit card with low or no interest and fees to pay.
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