You are here: Home - Credit Cards & Loans -

Over a million Brits have secret loans

0
Written by:
30/01/2008

Research from Abbey Loans reveals that as many as 1.35 million of the unsecured personal loans taken by the British public were made in secret, without family and partners knowledge.

The combined value of the secret loans is estimated at £7.7bn. Over half took out their secret loan in order to pay off existing debts. However the remaining loaners used their cash injections to make purchases: 199,000 people (15%) used a loan to finance home improvements; 90,000 people (7%) used the money for medical reasons while 27,000 (2%) used their loan for cosmetic surgery.

While the majority of secret loans taken out were for £3,000 or less (54%), the mean value of these secret loans was found to be £5,720. However, this was skewed upwards by the 5% of people who are worryingly concealing large debts of between £20,000 and £50,000.

Paul Morrish, director of Abbey Loans, said: “Borrowing in secret – especially large amounts – is not advisable and we would encourage people to be open and honest about their finances. Talking about your financial situation with others can help so that you can be realistic about what is affordable.

“However, for those who are comfortable they can afford repayments, it’s worth doing some research to find the most appropriate deal for you. There are different types of loans that suit different circumstances.”

The majority of those with secret loans said that they had not told their partner or family bout the loan because they were too embarrassed. Over a quarter stated that the loan was for a part of their life that they considered private while 6% took out the loan in order to surprise their family or partner. The research also reveals that those aged between 35-and-44 (6%) were the most likely to have taken out a loan in secret while those aged 65-or-over were the least likely.

Tagged:

Tag Box

Debt

Pension

Spending

Financial fitness

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

Which ISA is right for you? A round up of the six products available in 2017

From cash to innovative finance to lifetime, here's our guide to the ISA products available to savers this yea...

Guide to buy-to-let tax changes

In late 2015, former Chancellor George Osborne announced a range of  tax measures aimed at landlords, which t...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Five fund tips for a 0.25% interest rate environment

With interest rates stuck at a record low 0.25% and expectations rates could fall to close to zero, here are ...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Investing your money

Alliance Trust Plc gives you smart insight into how to invest your money

Money Tips of the Week

Read previous post:
Provider predicts ETF growth in 2008

This will be the ‘year of the exchange-traded fund’ (ETF), according to provider, SPA ETF.

Close