A FREE Northumberland debt advice service has urged people to be wary of ‘payday loans’.
Estimates suggest that around 3.5million people in the UK may turn to such financial services in the next six months as they struggle to make ends meet after Christmas spending.
But DAWN Advice has warned that taking such action could lead to money problems spiralling even further out of control as people are drawn into a cycle of short-term borrowing.
Chief Executive Liz Chadwick said: “January is always a difficult month for people as the true cost of Christmas really starts to hit home.
“Credit and store card bills will begin to arrive and reminders for any payments which may have been forgotten in December will quickly flood in. People can also be struck by previous Christmas purchases, which they had long since put to the back of their minds, if they’d taken out finance contracts, such as ‘pay nothing for 12 months’.
“Furthermore, employers sometimes bring forward the December payday to help employees cover the cost of the festive season, but by the time the end of January arrives, most will be starting to really feel the strain of making their pay stretch further than usual.
“With all these financial pressures hanging over people’s heads as they start the New Year, turning to a payday loan or commercial debt management firm may seem like the most appealing solution.
“However, I would urge anyone considering this to stop and really think about what they may be getting into and to seek independent and impartial advice before signing on the dotted line to ensure that they have found the right debt solution to suit their situation.”
For free, confidential and independent advice about debt call 0844 411 1309, or visit www.dawnadvice.org.uk