Personal debt sees a 150% rise in Guernsey

MONDAY, MAY 22, 2006

It seems that it's not only UK residents that are labouring with debt problems. The British Crown dependency of Guernsey has seen its residents' debt levels rise by 150% in 2005.

The figures, released in an annual report by the island’s Citizens Advice Bureau point to mortgages as a major contribution to islanders' financial problems.

In 2005 people saw their debt levels rise from £2 million to nearly £5 million. Most of the debt was due to mortgages, but credit card debt, store cards and other unsecured loans contributed to the overall increase in debt levels.

The Citizens Advice Bureau deals with consumer affairs of the 650,000 islanders, said it had observed a steep increase in the number of people seeking debt help and advice causing the organisation financial problems of its own.

Kate Raleigh, Bureau Manager, suggested that people weren't thinking through the consequences of their borrowing, and were simply not aware of the problems that they could face if they later ran into financial difficulties. "It all sounds good, but the point is that you are going to have to pay it all back, and people have to realise that if you can't pay it back the penalties can be enormous."; she said.