Lloyds bank has released results of its latest survey and it suggests that most people who are applying for personal loans are either using them for debt consolidation or to purchase things such as bikes or cars.
Around thirty percent of people applying for loans are doing so to move all of their debt into one more manageable, larger debt. A further third of loan applicants are doing so in order to fund purchases of cars and bikes.
It also said that over 80% of the people who were taking on new debts were confident about paying the loans back. However numerous financial advice charities have warned borrowers to make sure that they can afford the upcoming rises in interest rates.
These organisations have also urged people to take into account how they would manage with repayments if their circumstances changed due to redundancy or illness.
Lloyds have also reported that less people have been taking out loans to pay for home improvements.
It went on to say that consumers were more confident in this year’s second quarter than the first – rising from 82% to 84%.
This supposedly shows that people are more “in control” of their financial situation than previously. However there are plenty of analysts who believe this confidence could take a knock when interest rates rise – believed to be happening as early as the start of 2016.
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