Debt management 'eased by lower interest rates'

Lower interest rates are benefiting people with debt management difficulties, one expert has said, including arrears on tracker mortgages.

Martin Bamford, chartered financial planner and managing director at Informed Choice, suggested that consumers take advantage of the current financial climate.

However, those with savings may be negatively affected as their money loses value in real terms, he noted.

Additionally, the expert indicated that these conditions could continue as the government attempts to tackle the budget deficit.

"Public sector cuts ...could result in lower inflation for longer, which will keep interest rates down," he said.

Mr Bamford's comments follow a study by the National Institute of Economic and Social Research, which found that the economy is only likely to grow by 1.3 per cent this year, as reduced government spending limits its expansion until 2015.

Meanwhile, consumer price inflation will average three per cent in 2010 and 2.7 per cent in 2011.

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Anyone looking to remortgage their home to deal with debt management issues may struggle because of the falling house prices.

One of the signs a person may be struggling with debt management is that they only ever make minimum repayments on their credit card, one organisation has said.

Debt management problems in the UK could still be prevalent after new figures from the Bank of England showed record amounts of write-offs for credit cards.

There was an increase in the number of people looking for debt management advice from Citizen's Advice Bureaux in the first three month of 2010.

Filing for bankruptcy in cases of financial difficulty may not necessarily always be the easy option.

Homelessness in Scotland may be being caused by poor debt management, with a recent study showing a number of cases are due to mortgage arrears.

Debt management could affect pensioners, with living costs and inflation rising

Those going to university should make sure they draw up a monthly budget to avoid finding themselves with debt management problems, it has been advised.

If interest rates were not at an historic low, there would be more people struggling with debt management, one expert has said.

Thousands of new debt management cases are being seen by Citizen's Advice Bureaus every day, it has been revealed.