Amount of bad debt written off reaches `record high`

2 March 2010

Figures from the Bank of England (BoE) have suggested that individuals and businesses defaulted on £6.1bn worth of mortgages and loans during the final quarter of 2009 - the highest level since this data was first collected in this format in 1993 - the Telegraph reports.

Bad debts (debts which won`t be repaid) on mortgages and credit cards actually fell slightly, but there was a considerable rise in the number of people unable to keep up with other types of debt, such as loans and overdrafts - with write-offs rising to £1.36bn in the final three-month period of the year.

In total, lenders wrote off £205m of outstanding mortgage debt during the period, which was slightly lower than the £263m seen during the third quarter. Meanwhile, bad debts on credit cards fell to £894m, from the £1.57bn seen in the previous quarter.

As the Telegraph reports, `the steep jump in defaults on debt by Britons reflects the ongoing financial pressure many people are under due to rising unemployment and the high level of debt many consumers have taken on`.

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