UK Personal Debt Falls For The First Time.

Personal debt in the UK has fallen for the first time since records began. With interest rates in the UK currently at an all time low, the opportunity for home owners to pay off more than the minimum payments on their mortgages and other loans has helped to wipe off more than £600 million owed to the banks and other financial institutions. Net mortgage lending dropped £400million, while consumer credit through credit cards, loans and overdrafts dropped by £200million.

It appears, for the time being at least, that the philosophy of ‘Live Now – Pay Later’ has been put on hold in the UK. Currently there seems to be reluctance for people to spend with the aid of borrowed money from loans, overdrafts and credit cards.

The month of July also saw the number of mortgage approvals rise to a 17 month high. There is still however a great deal of concern with unemployment still on the rise, and many other obstacles in the mortgage market that still need to be overcome.

There are also fears that the sudden increase in the supply of homes for sale could trigger a new bout of price falls.