Household debt has soared to a record £5bn, according to new research by Leeds University Business School. The report blames the 70% rise on people falling behind on loan payments. The typical household has £25,000 of debt spread across 15 lenders compared with £10,000 three years ago. The report found that lenders now pass cases on to bailiffs once borrowers are only 2 months behind on payments (Guardian, 13 October).
Borrowers will be glad to hear that the Bank of England has left interest rates on hold at 3.5%, a 46-year low (Financial Times, 10 October). The Bank also predicted that house price inflation would fall to zero by the end of 2004. However, it moderated its forecast after prices failed to drop as far as expected (FT, 13 October).
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