Payday loans 'used to fund rent and mortgages'

Housing charity Shelter has claimed that hundreds of thousands of people are borrowing from payday lenders to meet rent or mortgage payments.

Live updates

Govt: Shelter figures 'based on small number of calls'

The Government has dismissed claims by housing charity Shelter 19% of home owners are forced to borrow from credit cards, payday loans or friends and family in order to pay their mortgage.

Housing minister Kris Hopkins said Shelter's figures were "based on a small number of calls to their helpline" and pointed to a fall in the number of repossessions and evictions as evidence of a stabilising market.

The economy is improving and rents are falling in real terms. Repossessions and evictions have been kept down by the Government's long-term economic plan, so landlord possession orders remain lower than under the previous administration.

Moreover, we have provided £470 million of central government funding to ensure we continue to have a strong safety net against homelessness.

I would urge people with money worries to get early help and advice so they have the most options available to them.

– Housing minister Kris Hopkins

Advertisement

19% admit to extra borrowing to pay mortgage

Nearly one fifth of people said they had borrowed money to meet a mortgage repayment last year, according to research by the housing charity Shelter.

Almost a million people used a payday loan to cover mortgage costs last year, Shelter said. Credit: PA

At least 19% of people quizzed admitted to borrowing in some way to keep their home, with 2% relying on a high-interest payday loan to cover costs.

Others had dipped into an unauthorised overdraft, borrowed on their credit card or asked family or friends for the funds, a survey of almost 3,700 people revealed.

Campbell Robb, chief executive of Shelter, urged those who are struggling with their rent or mortgage costs to seek help.

He said: "Our message today is don't keep your worries to yourself. Shelter's expert advisers can be the difference between keeping your home and losing it."

Back to top