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Banks attitude change for unsecured loan holders

Banks attitude change for unsecured loan holders

Category: Loans

Updated: 13/02/2009
First Published: 12/02/2009

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Banks are increasingly focused on helping consumers get out of debt, it has been observed.

Ian Boden-Smyth, of the UK Insolvency Service, noted that lenders are beginning to offer those with unsecured loans advice about paying them off.

He explained that in the past, financial institutions responded to defaulting by finding ways to provide lower rates.

However, he said that this has now changed, stating: "Instead of actually knowing someone is in debt and offering them a cheaper credit, they are now offering debt advice."

According to Mr Boden-Smyth, banks are "taking a different attitude" in the hope that consumers who are in debt will return to them when they are in a better position to take out unsecured loans.

Meanwhile, Debt Free Direct has urged those in who are experiencing financial difficulty not to delay before seeking help, as doing so will just mean that interest charges continue to rise.

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