For many of us, paying the mortgage or rent is our largest monthly commitment. And it’s not always easy to find the cash to make that payment.
Although there are some reasons to be cheerful these days – figures released recently by the Bank of England showed that the cost of borrowing has fallen to the lowest level on record – this isn’t good news for everyone. In particular, it will come as cold comfort to homeowners and renters who worry about their monthly bill.
Now it seems that some householders are taking drastic steps to keep up with their mortgage and rent commitments.
In fact, our research* shows that in a single month, some 1.5 million people in the UK borrowed money to pay their mortgage or rent. We also found that men and woman aged between 25 and 34 are most likely to have borrowed to cover these costs – more than twice as likely as other age group.
People living in the capital seem to have the most difficulties repaying their mortgage or finding the cash for rent, with 7% of our London-based respondents saying they'd borrowed for this reason.
It’s hardly surprising when you consider that the average cost of a house in London is £438,000 - much more than the national average in England of £225,000.
What’s the solution?
Although there are signs of recovery in the economy – and we should be thankful for that – thinkmoney’s research is a timely reminder that many people are still struggling to get by. And we can’t rule out interest rates in the not-too-distant future.
If you have borrowed to cover your mortgage or rent, this could be a sign that you need to re-think how you manage your money. The important thing is not to panic. There are ways to improve your finances.
For instance, it’s a good idea to contact your mortgage lender or landlord to explain the situation and find out what they suggest. Whatever you do, don’t bury your head in the sand.
It's also worth seeking expert help with your finances. Here at thinkmoney, we provide a personalised budgeting service, setting aside the money you need to cover the regular bills and commitments you've told us about, helping you make sure don’t miss any important payments. Find out more about the thinkmoney Personal Account here.
* Consumer Intelligence research carried out a survey of a representative sample of 2,202 UK adults from 31st July - 5th August 2013.