Half of those seeking debt advice have mortgages

Almost half of people contacting the Money Advice and Budgeting Service for help with mounting debt are mortgage holders.

Just a decade ago, people with mortgages who sought advice from MABS amounted to “just a handful” of all clients.

But spokesman Michael Culloty said that figure had surged to 47% in the past year, reflecting the growing financial woes of Ireland’s middle classes.

He said many of those now contacting the service are people who did well during the Celtic Tiger and accumulated property.

The brutal reality of growing debt was laid bare in a Central Bank report last week, which revealed that 70,000 mortgages — the equivalent of one in every ten Irish homeowners — are now in arrears.

And Mr Culloty said MABS had received a surge in calls in late January from householders struggling to pay off loans and utility bills after building up debt to pay for Christmas.

“Forty seven percent of people who contact us now have a mortgage. The primary reasons they get in touch might be to look for advice on their utility bills and credit card bills, which mounted up over the Christmas period.

“That tells us that more middle-class people are now in trouble, because they tend to have mortgages. A decade ago only a handful of callers would have had mortgages.

“People’s difficulties have become more complex and they have more debts than previously. And this time of year is particularly difficult, because people who borrowed money to pay for Christmas are struggling to pay their bills or in other cases seeing money-lenders arrive through their doors.

“It’s also the time when credit card bills and bi-monthly utility bills are arriving, many with arrears already on them.”

According to the latest stats from MABS, more than 17,500 people contacted the service in the first nine months of last year, a figure which, when calculated, is expected to exceed the 21,653 total for the whole of 2010.

Of those, 9,698 women contacted the service, an increase of 21% on the same nine-month period the year before. The number of male clients with debt problems was 7,836, while married couples, aged between 26 and 40, have been identified as the largest sector affected by personal debt.

Other research revealed that those in debt to a money lender increased from 210 in the first nine months of 2010 to 340 to the corresponding period last year.

In a separate survey by the CSO last week, one in ten households has had to borrow money from family and friends to afford basic goods and services.