IVA & Debt Consolidation Advice

We’ve already discussed the debt problems facing UK students as they graduate. A new issue has apparently arisen whereby graduates are struggling to enter the housing market because of their student debts.

In June we reported that many graduates were unable to make their debt payments, with a total of £ 180 million’s worth of loans in arrears at the end of the previous financial year. In total, students and graduates have accumulated a debt of £ 19 billion to finance their studies. Now it seems that over half of students who have graduated since 2001 claim that they are unable to afford to buy a home because of their debts.

According to an online survey by Thomas Clarke only one in ten students have bought a home since graduating after 2001. Over a third of students and graduates questioned stated that their debts would prevent them buying for another three years, with one in five claiming they would not be able to afford their own property within the next five to ten years.

According to the research, two thirds of UK students finish their studies in debt, with nearly 60% owing up to £10,000, 33% owing between £10,000 and £20,000 and one in 10 owing more than £20,000. Most of the debt is due to loans taken out to finance their studies. A considerable number of students had increased their debts further after graduating, spending on credit cards or personal loans and other unsecured debt.

As well as their debt problems hindering their ability to get a mortgage, two thirds of graduates said they were unable to save any money, and a half claimed that their debt problems were affecting their ability to finance their pensions.