Mabs warns 1m people worry about debt levels amid Covid-19 emergency

Bankruptcy - Business Person holding an empty wallet. Man showing empty wallet by showing the inconsistency and lack of money and not able to pay the loan and the mortgage.
Almost one million people are concerned about debt amid the Covid-19 crisis and matters may get worse when the mortgage breaks start to end this month, according to the Money Advice and Budgeting Service.
The survey by Mabs found the Covid-19 crisis had increased levels of debt distress since late last year, among the 35-54-year-olds living in urban centres and the commuter belt, in particular.
"This concern is likely to increase further this month with the end of mortgage payment breaks," Mabs said.
It found that over 1.25 million people in the Republic are concerned about current or future debt levels, with almost one million people now facing more concerns because of the Covid crisis.
"Despite the very real negative financial impacts experienced, less than half of those impacted have taken action as a result, and of those worryingly 21% have sought assistance from a friend-family member, 11% have borrowed from a financial institution and 6% have taken money from a moneylender," according to the survey.
Just 11% of those that have taken action have contacted a debt resolution or support agency to date, it said.
"There is evidence to suggest that people 'freeze in a time of crisis' indicating that the real financial impacts are yet to come," said Michelle O’Hara, regional manager at South Leinster Mabs.
“This will become evident with the end of the mortgage payment break this month,” she said.
"In addition, the courts will re-open in October and we predict an upturn in legal letters issued to those who have fallen into arrears on a variety of different loans," Mabs aid.
"There are also additional costs including childcare for families and those parenting alone with the opening of schools," it said.
"There are many who have lost employment or are on reduced hours and Mabs very much welcomes the extension of the various State supports into 2021 for these people.”