Homeowners run up credit card debt to pay mortgage

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One in five Brits has had to fall back on their credit card to pay their mortgage or rent arrears, according to new research.

Prepaid card provider icount, which published the study, further found that men are twice as likely as women to put their mortgage payments on their credit cards, with one in three citing ‘unexpected bills’ as the primary reasons for arrears.

Likewise, a third of homeowners or tenants in debt said it was because of gaps in Universal Credit benefit payments.

The study comes ahead of the FCA’s guidelines on the fair treatment of occupiers who fall behind on payments. It is expected to be published this week.

According to the report, the top five reasons for falling behind on payments are general living costs, benefit payment gaps, unexpected bills, changing jobs and prioritising other debts.

Samuel Mond, MD of icount, said: “The survey data highlights that the number of missed payments is rising across all age groups.

“This, combined with the changes being introduced on the 6th May should, in effect, help to educate all in the importance of these essential payments and go some way to reduce the number of people falling behind with mortgage payments.”

If you suddenly find yourself struggling with debt, it’s almost always better to tackle it head on. Mortgage providers or landlords may be able to help bridge the months between payments to avoid running up significant credit card debt. For more advice, please get in touch.

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