Many 'struggle with catalogue debt'

More people are showing signs of struggling with catalogue debts than they are with payday loans, mortgages or rents, a charity has warned.

The Money Advice Trust's National Debtline received more than 25,000 calls from people with debts to catalogue companies last year, the biggest number and proportion of calls on the issue in the Debtline's 25-year history and almost double the number it handled in 2007.

The debt advice charity has already taken 7,000 calls on catalogue debts in the first three months of 2012 and said the problem is one of the most common that it deals with, putting it ahead of rent and mortgage arrears and payday loans.

In 2007, around 8% of calls the Debtline received were about catalogue debts, but by this spring that share had grown to 14%.

Joanna Elson, chief executive of the Money Advice Trust, said: "Catalogue debts go largely unmentioned in public these days, but advisers at National Debtline hear from nearly 100 people every day struggling to repay such debts.

"Many people might be surprised to hear we get more calls on catalogue debts than on things like mortgages, rent and payday loans."

The charity warned that many people do not realise that when they make a purchase from a catalogue they are signing a consumer credit agreement, which means the debt is enforceable in the courts.

Squeezed families on restricted budgets could be attracted by "buy now, pay later" deals offered by mail order companies which allow them to stagger payments interest-free.

But Ms Elson cautioned: "Many many people don't realise that missing a payment on a catalogue debt will usually invalidate any special low or 0% interest deal."

Catalogue debt is the fifth biggest issue the charity deals with, behind bank loans and overdrafts, credit or store cards, council tax arrears and energy debts.