Repossession Repossession Repossession Coming To ITV
During the past ten years the nation has become addicted to living the high life on credit. It has been the party of a lifetime with revellers enjoying themselves like there’s no tomorrow.
But now, with interest rates up and cheap credit running out, the party is coming to an end with millions of people on the brink of financial ruin. Britain is about to discover that debts do, after all, have to be paid.
In this new one-hour documentary for ITV1 business journalist Jeff Randall reveals how and why so many people got hooked on spending money they don’t have and looks at the consequences.
It’s not just the lenders who are responsible for Britain’s debt mountain, says Jeff. The Government, bureaucrats and borrowers themselves are also to blame.
As home repossessions and bankruptcies soar, the programme charts an extraordinary social change in the UK, where there’s no longer any shame in borrowing to fund expensive lifestyles.
Jeff says: “I’ve been warning about the dangers of excessive debt for years. Now the day of reckoning has arrived. This programme reveals why our borrow and spend obsession is turning into heartbreak and repossession.”
The documentary features a West Midlands family whose home is being repossessed. The cameras follow them as they pack up and leave for one final time, handing the keys over to the bailiffs.
Mark, 43, and his wife Diane, 50, struggled to pay their mortgage for years, building up more and more debt.
Diane explains: “We’d never, ever think anything like this would happen…you read about it happening to other people but we always said it would never happen to us and it did.”
When they bought their house in 2000, their mortgage was £27,000. But they were allowed to borrow more to pay the mortgage and keep their heads above water. When they finally gave up the battle to keep their home, their debts had reached more than £142, 000.
Yet even after they had gone bankrupt the offers of new mortgages and loans kept arriving.
Mark says: “All the years of struggling and, thinking back, trying to buy the house in the first place. All for nothing.”
Model and dancer Shelley, 26, from North London, likes to look good. But it doesn’t come cheap. She spends a fortune on clothes and living the high life – much of it on credit.
“It’s like anybody with an addiction,” she says. “That’s my addiction, just shopping and spending and just enjoying myself really.”
The glamour girl likes to live a celebrity lifestyle even though she can’t afford it. Injections to smooth out her laughter lines sent her over her overdraft limit – again.
She knows she’s in financial trouble but doesn’t realise just how bad it is until she meets debt advisor Mike Thomas, known as the Debt Wizard. He tells her she owes £41,000.
Mike says of Britain’s debt: “We don’t have a debt problem, we have a debt crisis. And this means that more and more are lying to their loved ones, their partners, their spouses, they’re turning to gambling, alcohol to try and resolve their problems. And many I see tell me they’re suicidal and very, very depressed.”
Jamie, 23, who works for the ambulance service in Manchester, was just 18 when he was given his first credit card. This was followed by more cards, then loans to pay off his mounting debts. Now, after a four year spending spree, he owes more than £17,000.
“It was mainly for clothes and for paying for my friends to go out and have nights out, paying for a holiday. And at the time you think oh I know best I can afford it all. You’ll just end up in a mess. And I know from first hand that’s what happened to me.”
He adds: “Some people who commit murder these days and don’t have to serve 20 years in jail, whereas I’m now stuck with a 20 year sentence paying off all these debts.”
Furniture retailer Adrian, 39, from Nottinghamshire is living his dream – he owns several race horses and a third share in a riding stables. He even recently bought a racehorse on a credit card.
Apart from the horses he likes cars, eating out and last year enjoyed five holidays.
He says: “You only live once don’t you? So you may as well live for the moment rather than being the richest person on the graveyard.”
But Adrian is £1 million in debt on credit cards, mortgages and an overdraft and estimates he currently only has enough income to cover half the repayments. But he doesn’t seem overly worried.
“If someone lends me the money it becomes their problem, they’ve gotta get their money back, now I’m gonna do my damndest to pay it back but I’m certainly not going to lose any sleep over it,” says Adrian.
Lenders have been portrayed as villains in Britain’s debt crisis. But big banks tell the programme they have acted responsibly.
Gary Hoffman, group vice chairman for Barclays explains: “People binge eat, they binge drink, sometimes they spend, sometimes they binge borrow and what I encourage, what Barclays encourage, is for customers to talk to us when they have a problem.”
Randall visits the country’s biggest credit reference agency, Experian. They store every detail of our financial lives and keep them on file for years. The banks use this information to help them decide whether to give people credit.
So why have the banks lent so much to so many people who can’t repay the money? Randall explains: “We’ve been on a borrowing binge and they’ve been on a lending frenzy. The more the banks lent the higher they thought their profits would be.”
But the Government too bears some responsibility for fostering a debt culture in Britain, claims Randall. Student loans for example may have introduced a whole generation to indebtedness.
National Union of Students Vice President Wes Streeting, 24, graduated from Cambridge University three years ago.
He says: “I’m actually in with a combination of my student loan, a graduate loan I took out upon my graduation, my overdraft, and credit cards. It all amounts to the whopping sum of £24,000 which is £1,000 for every year I’ve been on the planet. So it’s quite a large amount of debt hanging over my head.”
But perhaps the biggest culprits, says Randall, are ourselves – the borrowers.
Social analyst Jim Murphy says: “We have a set of expectations that ratchet ever higher, and the notion that we should be denied any of these things because we haven’t saved enough for example, that notion has long since gone.”
Wednesday 6 February 2008 10:35pm – 11:35pm on ITV1.