An increasing number of Britons are struggling with their finances, new research reveals.

Figures released by Citizens Advice indicate that the advisory service’s branches in England and Wales witnessed a 35 per cent increase in those developing problems with mortgage arrears over the first two months of this year, compared to the same period in 2007. Overall, 215,000 new debt problems were indicated as being dealt with in January and February. Furthermore, monetary matters are now shown to be the main issue handled by Citizens Advice.

The study also indicated that debts in relation to plastic cards is the area where consumers are experiencing the most difficulties, despite problems with credit cards during the first two months of this years down by nine per cent from 2007. Meanwhile, money trouble involving overdrafts have risen by about seven per cent during this period of time.

Due to such monetary problems with mortgages and plastic cards, it may also be possible that many consumers are experiencing difficulties in handling other demands on their finances. Such areas could well include loans and transport costs.

The advisory service pointed out that the surge in people looking for help with their finances has been due to increased difficulties on the part of consumers when paying essential household bills such as gas, electricity and water. Additionally, more Britons are developing problems with council tax and telephone costs

Commenting on the figures, Teresa Perchard, director of policy at Citizens Advice, said: “It is a worrying trend that our bureau are reporting a very sharp increase in the number of mortgage arrears problems they are dealing with. These latest figures paint a worrying picture, suggesting a significant number of households are struggling to meet their most basic living costs. The combination of big increases in household bills, especially fuel and rising housing costs is putting additional pressure on people’s finances when they are already stretched to the limit.”

She added that those who are experiencing problems with managing their money need to “get help straight away”. By informing money lenders about their difficulties, it was suggested that borrowers are likely to be treated “sympathetically”. Ms Perchard also reported that in seeking out guidance from an independent advisory service could help consumers to set up an affordable repayment plan and to receive all the benefits to which they are entitled. “You may be missing out on money that could help off-set your costs,” the Citizens Advice director added.

For consumers struggling with debts accrued across a number of sources taking out a consolidation loan may be advisable. By getting such a loan, borrowers can merge debts run up on plastic cards, household bills, mortgages, overdrafts and spending demands into a single low-cost monthly repayment. Indeed, a cheap consolidation loan might be of assistance to significant numbers of Britons after a MoneyExpert study carried out last year showed that 7.4 million bill payments had been missed during the first six months of 2007, an average of about 1.23 million per month. Sean Gardner, chief executive for the firm, stated: “It is clear that many of us are under financial pressure.”

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