Credit cards being used to pay the mortgage, reports London Mortgage Broker, London Mortgage Advice Tuesday, 12th January 2010

Over the course of the last year, over a million families in the UK have resorted to using a credit card in order to pay their mortgage or rent.

Householders and private rental tenants from across a spectrum of income brackets were forced to put their payments on credit in order to keep the roof over their heads,
research carried out by homeless charity Shelter revealed.

Shelter used the data and concluded that it indicated more than a million households were forced down this undesirable path of action in 2009, from a survey that was carried out on a sample of 2,022 people. It showed that 6% of respondents had used a credit card to meet their mortgage or rent obligations.

For lower social groups, the number of people resorting to using their credit cards over the past 12 months rose to 8%, while the figure for middle class people totalled 4%.

With one in 12 residents in the capital admitting they had resorted to flashing the plastic to make their monthly mortgage repayment or rent, the problem was notably more common in London,

"This is a shocking discovery, that over a million households in Britain are in such desperate circumstances that they need to borrow money on credit cards to pay for basic housing costs,” said Kay Boycott, director of policy and campaigns at Shelter.

"If people are already struggling to the extent that they fear losing their home, increasing credit card debt cannot be the answer."

Building up debt in order to pay for fixed costs such as housing could eventually lead to many of those families affected damaging their credit records and ultimately losing their homes Shelter warns.

Plastic providers can covert unsecured debt on credit cards into secured debt (held against property) by using something known as a charging order - which allows them to obtain a court possession order to force a sale to recover the debt.Credit card companies are not subject to the same rules and regulations as mortgage lenders and have more options available to them when it comes to recovering their debts.

"It is absolutely vital that every single person using credit cards in this way seeks advice urgently to get the help they need to ensure they don't lose their home.” Boycott said