UK homeowners are being forced into debt by taking out loans to pay for energy bills

The price of energy bills is becoming a massive strain for homeowners at the moment and people are taking out loans to pay for their bills and provide food. A staggering one in five homeowners has taken out a loan in the past year, with 56% expecting to carry on the loan into next year. Out of 2,000 people surveyed only 8% have said they did not take out a loan.

According to Circle Housing Group who ran the study, around 30% of people used the loans to pay for necessities such as food and basic livings needs. A further one in five required help to cover their expenses including mortgage and credit payments or energy bills, 21% and 17% respectively.

Due to hard times, the general public were thrilled with Ed Miliband’s pledge to freeze energy prices if he won the next general election, however energy suppliers had mixed views on the matter.

These statistics are worrying and clearly show the problems that many homeowners are facing when it comes to managing their finances.

The Group Financial Inclusion Manager at Circle Housing, Matt Earnshaw said “In the social housing sector we know many are struggling to deal with rising food bills and spiraling energy costs.” (Circle.org.uk, September 2013)

First Utility have previously announced that the energy industry need to shorten the amount of time switching takes from five weeks to just one day. Energy Switcheroo offers an easy online switching service for consumers and businesses to help save money, which will make a difference to household’s energy bills meaning that everyday needs will be easier to fund.