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One-in-three Brits use payday loans for mortgage costs

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More than one-in-three Brits have taken out a payday loan to help them meet their monthly mortgage or rent payment, research has found.

The Debt Advisory Centre said 35 per cent of those surveyed had been forced to take out a high interest short-term loan in the past 12 months to meet housing costs.

An additional 13 per cent also took out a payday loan to fund a one-off emergency such as boiler repairs, the survey found.

However, the most common use for a payday loan was to buy essentials such as food and travel.

In total some 3.5m people in the UK have taken out a payday loan in the last 12 months, representing 7 per cent of the population.

Men are more likely to take out a payday loan with 9% accessing such finance in the last year compared with 5 per cent of women.

There is also a bias towards younger borrowers with 17 per cent of 25-34 year olds admitting to having taken out a payday loan. This compares to 3.6 per cent of people aged 45-54.

Ian Williams, spokesman for the Debt Advisory Centre, said: “Many people who are struggling with money problems often put off tackling them – for example, believing that if they can just borrow some money to get through this month, then things will be better next month.

“However, for a great many people that simply isn’t true: if you have got to the stage where you need to borrow money to buy food or pay the rent, a loan isn’t the solution – it is time to seek expert help with you finances.”

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