Seek advice if your are running up debt problems

A rising number of people in North Lincolnshire are seeking help for debt concerns as the economy deals with the after-effects of a double-dip recession.

In the first six months of 2012, the Credit Counselling Service (CCCS) says it has received 834 inquiries and is in line to far exceed the total number of calls last year of 1,317.

And experts there and at the Scunthorpe branch of the Citizen's Advice Bureau say the problems are likely to get worse before they get better, as major Government cuts to benefits take effect.

John Burnett, specialist debt case manager at Scunthorpe Citizen's Advice Bureau, said changes to benefits and welfare reforms would continue to have an effect on the number of people seeking help.

"Over the past two years, I have seen a much larger number of higher income people because of the cutbacks, businesses closing down and people cutting down on what they are doing," he said.

"People on middle incomes will be having problems because they can no longer afford the credit they built up, when they could afford it years ago.

"People who did not used to will have to start paying council tax and when you are getting paid £71 in benefits and have to find 25 per cent for council tax and top up your rent, you are not looking at much left over.

"I expect to see more people coming through the door with council tax arrears issues who previously will have not used the service."

Latest figures released by CCCS show that the average person in the region owes £14,367 in unsecured debt.

This can be made up of credit card debts, personal and pay-day loans.

Despite being down on the 2011 figure of £15,765, the charity is concerned about the level of calls it has received.

The number of repossession claims made at Scunthorpe County Court peaked in 2008, but the figure still remains higher than in 1987 when figures began.

In 2011, there were 275 repossession claims made to the court, with 225 of them successful.

The figures, released by the Ministry of Justice, show that in 1987 the number of claims made was 195.

The figures peaked in 2008 when there were 565 claims made to the court, with 420 of them successful.

A spokeswoman for CCCS said financial issues were causing people a lot of worry.

"We are very concerned about the number of calls that we have received, which looks likely to exceed the number of calls received last year," she said.

"This is despite the debt levels coming down.

"This is partly due to levels of unemployment, welfare and benefit changes."

The amount of unsecured debt owed by different age groups shows the 40-59 year-old age bracket owes the most on average.

The figure of £16,760 is slightly above the average of £16,453 owed by those over 60.

The under-25s owe on average £4,952 and the 25-39 year-old age bracket owes £12,726.

Patrick Hall, Scunthorpe branch spokesman for the Samaritans, said the economic situation was the reason behind many of their calls.

"Almost one fifth (18 per cent) of contacts relate to worries about money, employment and the wider impact on family and relationships," he said. "It is that wider impact that often causes the greatest distress and despair."

Mr Hall said people should not feel alone and that the Samaritans was always happy to help.

"Men are particularly vulnerable to suicide in North Lincolnshire as it is a region with traditional values and men are less likely to talk about problems," he said.

"It can sometimes be very difficult to talk to close family members about financial issues so we provide a completely anonymous source for someone to speak to.

"Talking is very important, otherwise feelings get bottled up like a volcano and will become too much for someone to cope with.

"Nobody should feel alone, however difficult or embarrassing their issues."

Bob Riach, proprietor of the Scotterthorpe-based Riach Independent Financial Advisers, said although it can be tempting, doing nothing will only add to problems if you have money worries.

He said: "If you have concerns about your ability to repay your debts, whatever you do, don't just ignore it and hope that it will go away. The sooner you deal with debts the better.

"It can be tempting to do nothing and just hope things will sort themselves out. If you start to miss payments, your creditors can put you under increasing pressure to settle the arrears.

"If you are already in this situation, don't be bullied into agreeing to pay more than you can afford, because that will make your problem worse rather than solve it."

The number of individual insolvencies in North Lincolnshire peaked at 497 in 2009 as the recession hit hard.

Despite latest figures showing there to have been 360 cases in 2011, the figure is still four times higher than in 2000.

Andrew Percy, MP for Brigg and Goole, has openly spoken about his troubles dealing with debt and has headed up a cross-Parliamentary campaign to try to introduce debt education to the curriculum.

"People should not feel alone and should not feel ashamed," he said.

"I have spoken very openly about debt, which I would not have been able to do a few years ago and I know that a lot of people in the same boat are still struggling. The reality of the situation is that the vast majority, myself included, are not equipped with the right skills to ask informed questions to make informed choices."