In what has become a way of life, we spend more than we earn. In many cases, a lot more. Far too much more, in fact. Mortgages and property debt play a big part in what we owe.
Certainly Northern Ireland is not immune. Like every other country in the so-called free world how ironic there is widespread debt and a glut of the problems that flow from it.This is not new, of course. As long ago as 1732, Thomas Fuller was warning his contemporaries: Debt is the worst poverty.
But you can go back a lot further, far beyond Fuller to the Old Testament books of 2 Kings, David and Proverbs where you will find censures against debt as a concept.Northern Ireland debt has reached record levels with an estimated 250,000 of its citizens now in serious trouble, 62% of that total made up of families in which, in over half of cases, both parents are working.
Figures reveal that the amount borrowed in November 2015 – for Christmas – was the highest for any month since February 2008 when the pre-recession credit blow-out reached its peak. And now borrowing just to make ends meet – is rising again, giving rise to fears over borrowers’ ability to repay. Low income families are particularly vulnerable.Already it is believed that 217,000 adults about 15% of the Northern Ireland population are in greater debt than they can handle realistically. That means that if they were businesses rather than human beings, they would be deemed ‘no longer be viable’.
Unfortunately, human nature is to put off facing up to the problem for as long as possible. Denial, pride, fear, embarrassment, a sense of the perceived hopelessness of their situation and maybe a combination of each of those play a huge part in the process.
Kathy McKenna of Citizens Advice, has warned: Sometimes it’s only when the situation gets out of control – for example when a client receives a court letter or eviction notice, or cannot get access to any more credit – that they will come seeking advice.Our experience shows that people generally wait a year before seeking out debt advice. However, waiting means their financial situation can spiral even further out of control, leaving them deeper in debt.
Everywhere you look, it seems, debt problems abound, with negative equity and other debts accrued elsewhere combining to produce a particularly toxic cocktail.
Negative equity debt where your home now is worth less than the mortgage outstanding on it is a huge source of concern in the overall Northern Ireland scenario.
True, house prices have begun to rise so, finally, there is some welcome growth in the market. But that must be viewed against the backdrop which saw prices in Northern Ireland plummet far more steeply and quickly than elsewhere in the UK. Even in some areas where house prices have increased, they are only half-way back to the level in those days of seemingly endless money and totally affordable mortgages.
Make no mistake; we are playing catch-up – and look likely to be doing so for a long time to come. Meanwhile life goes on and ensuring that it does remains a major problem but nevertheless the priority – for tens of thousands.Many want and require answers to just a couple of basic questions.