U.S. Consumers Are Not Alone When It Comes to High Debt Levels

[Mar 19, 2010.]

 

American consumers are known for carrying large amounts of debt. Total consumer credit is around $2.456 trillion in the U.S., according to the Federal Reserve. But borrowers in other countries also are dealing with debt overload. What can consumers do about all this debt?

Personal Loans in the U.K.

Statistics from the Consumer Credit Counseling Service show that personal loans make up about a third of the debt of U.K. consumers, according to an article at QCK.com. The charity said 39% of consumer debt is from personal loans, while 46.3% is from credit cards.

Canadian Debt Levels

In Canada household debt hit a record high of $91,000 in 2009. A Royal Bank of Canada (RBC) survey of Canadian consumer outlook in January found that 58% of Canadians are worried about their current debt level, according to the Globe and Mail.

"We saw people delaying major purchases, so they did some belt tightening. They're a little less positive about the Canadian economic outlook, and they're more concerned about jobs," Marcia Moffat, who runs Royal Bank's mortgage business, told the Globe and Mail.

Debt Solutions

No matter where you live having too many loans can be stressful. It's important to get help with debt if you are having trouble coping on your own. A debt counselor can help you work out a payment plan for loans, credit cards, and other types of debt.

Debt Management Plan

Other options include signing up for a debt management plan. This involves setting up a plan with a debt management firm that helps you pay off creditors. You pay fees to get this type of help, so make sure you know what services are involved before signing up. The debt management firm sets up an account that you make payments into over a period of time. Once you have enough money it is sent to your creditors to pay off bills.

Personal Loans with Bad Credit

Some people who are struggling to pay bills may look to get debt consolidation loans even though they have bad credit. While a loan could help you consolidate debt and lower your overall interest rate, many banks are reluctant to loan money to people with bad credit these days.

If you think a loan can help you consolidate debt, gather quotes from several reputable lenders to choose the right deal.

 

 

About Author:

Francine L. Huff is a freelance journalist and the author of The 25-Day Money Makeover for Women. She has appeared on a variety of TV and radio shows.