New Lines: Living with debt

[Music] yeah alright sounds thérèse put it in the kitchen Sandra is in debt why haven't you got your heater on because we can't afford to put it on that's why I don't get paid till after January the second week in January still have to go without it'll don't want when family call me don't go bad in her case because of an error in overpaid benefits benefits she now has to pay back oh my goodness she's so sweet until the debts cleared it's almost hard what she has left to spend on food with a granddaughter coming to stay her finances can't stretch to feed another mouse five pounds a week Dix gets 14 backfist 14 dinners and 14 teas at the moment I have five pounds away to get 21 blacklist 2110 it and plays warranties put that any pot could you do it because I grass debt is an invisible burden being carried by the country's most vulnerable I've just thrown in some cereal and some little toys and that yeah you research for Sky News shows just how big a burden that is right three kids many here in Rock Ferry Merseyside rely on crisis handouts just to make ends meet with many borrowing simply to live I am in debt which I am paying off and I'm covering that it's coming out of my wages and go into debt currently due to my past circumstances I'm struggling so much that loans I have three children 12 14 17 we aren't sure how we will get through questioners for the first time food donations here can't meet the calls for help this is neo community house in the heart of rock Ferry in Birkenhead its volunteers catching families in crisis sorrows bus a suggested donation of 150 people pay what they can afford to stretch their budgets before borrowing they offer food warmth and advice to people dealing with debts they can eat for free you know that's what we do we want cheering anybody away they're now helping more working families than they are people on benefits low incomes simply too low to make ends meet I've been out and bought a two-year-old about help me own money couple months ago some of them really gets here some of them you can walk away from you can help them and walk away on some behavior or polar night in tears as we're speaking ally realizes an emergency delivery for a new mum has been left behind a baby is crying as we speak because it's got no milk a shot a five week old baby who's starving these are problems they deal with every day of the year every time you go to lock the door you've got another one pulling up outside around Christmas there's just more of it more calls from people needing loans electricity food the baby formula eventually makes it to Makayla she had a baby girl five weeks ago but a maternity pay hasn't been paid along with her growing pile of bills fees and explain the situation that he's been it's been tough enough for Makayla as a single mom on a low income but no maternity pay at Christmas pushed her into mounting debt with a newborn and an 11 year old Stephen Dolph Dolph to actually know that there's a problem we can see them except where she can't so or it just it really looks at me because it just adds to the stress of war I'm already going through and it's not like I don't wake away a card and what that do you have a council tax which debates yeah I am I just started text and I've got I haven't got it and the only thing I've got is tally and you know welcome to come and take it but you'll be taking it from me soul and he didn't have sorry for me but I'm just worried you know daddy gonna show off at any point and actually don't answer the door like you know if people not had an accident like Sandra Michaela's in debt because of a bureaucratic error that for people in average salaries would be manageable but for people experiencing poverty it can be a crisis research done for Sky News shows the poorest 10% of households with a debt spend a third thirty four percent of their gross income on repayments that's more than three times the case for average household incomes and 31 percent of people experiencing hardship use loans to finance day-to-day spending that's bills food simply living and among this demographic 32% are already having difficulties keeping up with debt repayments again these figures much higher than for those on average incomes so where can people turn for help one offer has come to Makayla in the form of a letter from loan company Provident it sells the picture of a perfect Christmas along with loans at five hundred and thirty five percent Merseyside is home to some of the poorest parts of the country and these letters offering doorstep loans are falling through letter boxes in the most deprived areas like Rock Ferry the high levels of interest to finance lending to high-risk customers debt isn't a deprivation issue but affordable credit is the main difference being if you have money you can borrow relatively cheaply from a bank or credit card but if you're scraping by who's there to sub you for people experiencing poverty two of the main sources of cash at doorstep loans and loan sharks and when finances are really stretched around Christmastime these money lenders are targeting some of the poorest streets in the country unlike loan sharks companies like Provident are legal and provide credit that otherwise wouldn't exist for many people but the debt can spiral frightening new out of control we said once I paid so much off I could have another one Mary took out a 300 pound Provident loan last Christmas then another she doesn't want to be identified so we've changed her name what are the repayments about fifty five pounds on earth are you paying them no I couldn't afford a I couldn't afford it so what's happening and a few getting letters of different bailiff companies Mary is also a single mum and doesn't have family nearby for help but you don't need to look far in Birkenhead to see the alternatives traditionally loans were funded by the states or friends and family but those safety nets don't exist anymore for most people and a new industry has grown to fill that hole Provident is the biggest provider of doorstep loans and home credit in the country with four hundred and forty thousand customers we went to see them at their office in Birkenhead but they didn't want to speak to us they did send us a statement though and said our customers need access to credit to live their lives we lend responsibly our customers know what they need to pay back as the amount they repay is fixed at the outset voice recording now takes place and our customer visits to ensure we have treated our customers fairly many people here have taken doorstep loans to make ends meet the interest is high but it's been capped by law since 2015 but loan sharks preying on vulnerable communities around the country are criminals and set their own terms we've been told they are operating here but fear stops people telling us much more than that their enforcement methods can be frightening we believe that loan sharks are operating in most communities but here the tables have turned the illegal money lending team are about to doorstep a loan shark in leads with an arrest warrant when we get there the suspect claims he's locked in and his wife's gone out with the key okay where's your wife have you found her you don't have a phone yeah okay if you don't open the door we're going to force entry his wife then appears with the key I am working part of the National legal money lending team you're now under arrest and this one yes right the man arrested on suspicion of operating as a loan shark was later released and inquiries are continuing it's estimated 325 million pounds is borrowed from loan sharks every year and more than 700 million paid back the interest so high one man borrowed 1500 pounds and paid more than sixty thousand this is what we see time and time again they portray themselves as your best friend they portray yourself portray themselves and they get into your psyche that they're a friend what sort of interests are they charge and we see we see interest APR 15 2014 1 towards people who can't repay those that we've seen everything from assaults to wound in kidnapping and even as far as right we've been told nearly three hundred and ten thousand people in the UK are in debt to loan sharks with the benefit to criminals and value of loans reaching nearly 36 million pounds Jacquie has never used a loan shark but as a single mum with six children she's built up debt it'll take years to clear I've been in a lot of debt where I don't even read me lashes anymore I did come through the door and I just pop them straight in the bin and what debt and even at the moment thousands do me voluntary jobs and I work at the hive as well just to keep myself out the house and save on gas and electric through the day to be honest go in through the night time we go to bad alien stuff like that despite working at the local youth center she says she struggles just as much as when she didn't have a job and puts pressure on herself to provide for her kids especially at Christmas each kid I always when they under pound and this year just said less and 400 pounds and off she really need to be spending 400 pounds on each kid we didn't have much growing up when I was a kid and I always wanted to give them what I never had debt often affects women more than men because they earn less and have more childcare pressure and in Mikayla's case unpaid maternity mommy she's still concerned the bailiffs will be back with no credit to make calls we lent her a phone to try and track down her maternity she's now received some money and an apology from her employers and applied for a debt relief order we can say we understand the data understand they will never understand what it's like because it never happened to them what makes it we feel way more angry is that it's it's Maternity it's put in place to protect women Michaela's hope of going to university seems as distant as ever she fights to keep the bailiffs at bay and keep the roof over her kids heads luckily were not begging so if you know on away the Makayla it was unpaid maternity for Sandra a mistake to her benefits that pushed her into debt you only say thank you no animated of stench making ends meet remains a daily struggle when did you enact money this month about the fourth jam with Dan because it has exposed to getting hard to get at so fossil was away at well so now if you need to go to hospital how'd you get there well if I was to go to hospital now it would be a three to four hour walk for me Sandra says she's not wishing her life away when she turns 60 in three years free bus pass would be life-changing meanwhile Mary's loan repayments still haven't caught up with her but she's anxious when her existing benefits switched to the new system of universal credit it will push her into taking another eventually they are gonna catch up but when you're in that situation and you struggle and you're really down in the dumps you know you can turn to them and they will give you money I'm dreading well I do go on universal credit I will be getting alone and when will that happen they reckon about day if I'd be ready next month people can't budget what they haven't got deprivation offers little way out of debt it's a losing battle an endless cycle a little comfort knowing so many families are in the same position

Channel: Sky News

Views: 30,625

Rating: 4.6945453 out of 5

Keywords: NEW LINES, DEBT, LIVING, POVERTY, SKY NEWS, SALLY LOCKWOOD, SPECIAL REPORT, MERSEYSIDE, LIVERPOOL, LOAN SHARKS, RENT, HOUSING, FOOD BANKS, INTEREST, LOANS, FINANCE

Id: wq-gh9I8qr4

Length: 14min 21sec (861 seconds)

Published: Thu Jan 31 2019