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Christmas can be an expensive time for British households and it can be very tempting to spend beyond our means during this time. Some of the ways that people manage their Xmas spending includes going into their credit card overdrafts and using high cost loans to tide them over until January – despite debt charities and money experts advising otherwise.

Recent statistics show that borrowers have doubled the chance of being forced to give up gifts this year due to lack of funds, according to Debt Hacker.

The research showed that around one-quarter of Brits will struggle financially to buy a gift for their loved one, although those that use high cost loans will struggle by as much as 52%, despite using a loan to help manage their spending.

The study further found that a whopping 44 per cent have been left with no choice but to miss out on meeting up with family as they simply cannot afford to get there.

Financial hardship also stands in the way of the festive feasts since high-cost credit loans make it twice as likely for borrowers to skip a meal while a quarter will be reliant on foodbanks. This is compared to just 7 per cent without a loan.

Debt Stigma

Britain has typically placed a stigma on those that suffer from debt issues. This can have some serious repercussions in the form of loneliness and isolation, with one in five people who have said they have taken out high cost credit having no one to talk openly with about their financial struggles.

If you add the pressure of Christmas onto this, twice the amount of high cost loan users feel under a huge amount of stress to spend more than they can afford to.

Debt Hacker

Debt Hacker is an online campaign which works to help borrowers fight back against unfair and exploitative lending practices. They do so by using free tools in order to make a complaint and recoup interest and fees from any loans which were mis-sold and any other loan compensation claims.

They will also work to get these loans taken off credit files so that it does not damage the borrowers credit score. It also ensures that they will not get trapped in spiralling debt again, which can lead to poverty.

For those looking to use loans over the Christmas season, consider borrowing from family and friends first since the terms are bound to be more flexible and will probably not incur any interest repayments. Otherwise, you can consider borrowing from a credit union which only charges 26% representative APR and has no late fees.

If you prefer to be discrete and apply online, you can use a comparison website in order to find the best rates and terms for bad credit loans, short term loans and more.


How high cost loans are impacting Brits at Christmas
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