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Consumers `increasingly experiencing debt problems` Over-50s `better at managing credit card debt` New banking rules `may restrict access to loans` UK `must reduce consumer debt` 700k `on Debt Management Plans` Recession `could lead to financial problems for retirees` Charity sees increase in debt, mortgage and loan arrear enquiries Retirees` finances `may be damaged by rate cut` Consumers `aiming to reduce spending` People `increasingly turning to illegal loans` Children raised in credit crunch `may be better able to manage money` Many parents `pushed into debt by adult children` Young people `failing to protect themselves for debt repayments` Consumers in East Midlands `relying less on debt to fund lives` Plans set out to help people in debt PPI ban `could leave consumers without loan cover` Govt `must step in to stop debt addiction` Cash-strapped Brits `see fraud as more acceptable` People `should not rely on mortgage rescue plan` Consumers `to take out £3bn in debt consolidation loans by Easter`

Loans taken out `to consolidate debts`

25/09/2007

Debt consolidation is the main reason for taking out a personal loan, an industry expert has claimed.

While people take out loans for a variety of personal reasons, consolidating rising debt is the reason in "over 40 per cent" of cases, according to Sainsbury`s Bank.

Easy credit over the last few years has made the amount of people saving decrease, however, people are now looking at their credit situation more acutely and loans are being used to ease the financial burden, Steve Baillie, head of loans at Sainsbury`s Bank, said.

Mr Baillie added: "If you are going down the consolidation route you have to be strict with yourself so that you`re not just deferring the problem for future months and years. Shopping around is the most important thing."

According to Credit Action, the total consumer credit lending to individuals in July 2007 was £214 billion - an increase of 5.3 per cent in the last 12 months.

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