(1888PressRelease)
May 13, 2007 - The Bank's bi-annual Financial Stability Support cautioned of the dangers of Britons' personal debt, which has reached a combined £1.3 trillion - leaving many especially sensitive to increases in interest rates and 'abrupt' economic downturn.
According to the report, household debt has increased to 150 per cent on average annual incomes - up from 100 per cent at the end of the last decade.
As a result, the bank has warned Britons to cut back on spending - especially as data from the Council of Mortgage Lenders (CML) shows financial precariousness among Britons has led to ever rising numbers of repossessions.
Although total repossession figures are well off their 1991 peak - when 75,540 people in the UK lost their homes - they increased by 65 per cent in 2006 to reach a three-year high, data from the CML shows.
The CML predicts 18,000 repossessions both this year and next.
Julian King, director of the UK's leading quick sale property company National Homebuyers adds: "We find it hard to believe that homeowners have ignored the warning signs for the last 24 months.
"Being at the forefront of the UK property market and solving peoples' financial problems every minute of the day, we confirmed that homeowners would feel an increasing 'pinch' on their available funds as long as two years ago.
"The rise of 65 per cent in repossessions last year must surely set some sizeable alarm bells ringing to everyone. National Homebuyers recommends that people who are facing financial difficulty to speak to us immediately before their situation becomes unmanageable."
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