An increasing number of people are approaching the bureau for help with financial problems.

There has also been a significant change in the numbers of people helped at the bureau court desk at Worthing County Court.

In the last three months, Worthing CAB has seen a 35 per cent increase in debt issues when compared with the same period last year.

Struggling

Mr Chapman said: "No client's situation is the same.

"Many have been struggling for months but the current economic situation, which has seen a huge increase in the average family monthly expenditure, basic food bills, fuel, gas and electric bills and mortgage interest rates, this has been the last straw.

"It is known that many, unable to pay food, mortgage or rent bills, are using credit cards and loans to meet these essential expenditure costs.

"It is only a matter of time before they also will be overwhelmed by their debts."

Recession

He said there are disturbing features that show a more direct impact of the recession.

Construction workers are being particularly hard hit as many proposed developments are being put on hold, indeed many building projects, which have already been started, are being halted and workers laid off.

One example is a self-employed carpenter who had been laid off because of the present downturn in the building industry.

With a mortgage of £800 a month he was already facing loss of his house, but the approaching end of the fixed-term lower interest rate on his mortgage was the final nail in the coffin.

Mortgage

Other examples quoted by bureau debt advisers include the client who had found his income stream had dried up because the property market has frozen and found he could not meet the interest on his own mortgage.

He was forced to move out of his own home and rent it – and still faces a shortfall of £500 per month, rising to £900 when his fixed-term mortgage package comes to an end.

They are lucky to have family support – many are not so fortunate.

Horrific

Debt adviser, Jan Burns said: "We are not only seeing a greater number of clients but the levels of debt are quite horrific.

"£90,000 to £100,000 is no longer unusual and many are in the £500,000 plus bracket when one includes mortgage debt.

"At the same time we find that creditors are becoming harder and are more reluctant to agree to reasonable offers from clients."

Figures from the National Council of Mortgage Lenders show a 16 per cent increase for the first three months of the year.

Arrears

The CAB has not seen a significant increase in the total number of possession orders in Worthing, there are far more mortgage arrears compared to rent arrears than earlier in the year.

There are record numbers of people seeking out help at the court desk at Worthing County Court – seven at the last Monday session.

When asked what advice can be given to those who are feeling anxious or do have real problems, bureau manager, David Chapman said: "Do not put your head in the sand.

"Seek help at the earliest opportunity.

"Keep your creditors – especially landlords and mortgage lenders – informed.

Helpful

"You may find them more helpful than you think.

"Beware of those firms who offer a 'quick fix solution' to your debts through 'little known government laws.'

"This may be an IVA.

"An Individual Voluntary Arrangement, whereby with creditor agreement, debts can be written off over a five-year period, for a percentage of the total debt.

Alternative

"This is an alternative to bankruptcy and is legally binding.

"It may be a credible solution for some.

"However, we have recently seen clients who entered into an IVA, and after struggling to make payments for over two years they could no longer continue to pay.

"The firm who set up the IVA acknowledged that the IVA had failed.

"The clients were shocked to find that the money they had paid into the plan, over £6,000, had been used to pay the practitioner's fees; no money at all had been paid to their creditors.

Bankrupt

"Had these clients owned a property they would have been in danger of losing their home through one of their creditors making them bankrupt.

"People should also exercise caution when considering schemes to sell their property and then continue to live in the home as a tenant.

"They are unlikely to have security of tenure beyond an assured short-hold tenancy agreement and there are other things that can go wrong with these arrangements that can result in loss of the home.

"There are often other solutions to their difficulties."

Pressure

He continued: "The bureau is desperately short of resources to handle this growing pressure.

"We need volunteers willing to train to be advisers, and people with administrative experience to help with the debt management."

Mr Chapman can be contacted on 01903 532662 or by email dchapman@worthing.org.


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