This leaves them particularly vulnerable to spiralling debt which they have little prospect of clearing."It is feared that this financial predicament is having a big effect on well-being. Findings in the report show most respondents feel that debt has harmed their health, while 12 per cent said they had gone so far as to contemplate suicide.The report goes on to say that high levels of debt have affected their basic quality of life. The vast majority of respondents reported that they had been forced to make cuts in essential spending - most often on food or fuel - while a similar number had scaled back on services, equipment or aids.But despite all this evidence of hardship, there are concerns that the banking industry is not being sympathetic enough.Leonard Cheshire believes many creditors lack knowledge and understanding of disability, and as a result, pay insufficient attention to the needs of those who have difficulty paying off their debts.Just under half of the participants in the survey claimed creditors had been unhelpful, and in most cases, this was because the lender had treated them exactly the same as other borrowers and made no allowance for their circumstances.Leonard Cheshire is calling on the Government and the credit industry to make a number of reforms to reduce the debt problems facing disabled people, and has drawn up a list of recommendations. "A significant amount of this debt comes from essential purchases, such as food, heating and clothing, rather than luxury items. They may have to pay, for example, for electric wheelchairs, home modifications, communication aids and personal care, as well as facing extra heating and electricity costs.The result of this mix is higher borrowings - run up on credit cards, bank overdrafts and personal loans.
Their main income is, in many cases, supplied by state benefits such as the disability living allowance and incapacity benefit,Meanwhile, more than half of those questioned for the Leonard Cheshire study reported annual incomes of less than £10,000 - compared to the national average of £22,060.Many disabled people are living below the poverty line, "In the Balance" points out, yet they often have to shell out vast sums due to their conditions. Figures show that the average debt among Britain's disabled stands at £8,750, but it ranges as high as £52,000 in some cases."Disabled people are being forced into arrears," says John Knight, head of policy at Leonard Cheshire. But one group caught in the debt trap has been largely neglected - the disabled, an issue highlighted in a report out this week entitled "In the Balance". Leonard Cheshire, the charity behind the study, wants to raise awareness of the heavy debts of the disabled - a plight that is not down to extravagant spending but the financing of basic needs.Research shows, for example, that they are less likely to be in paid work - with nearly half of all disabled people unemployed, compared to 19 per cent of the non-disabled population. Last year, the level of consumer debt in the UK broke through the £1 trillion barrier, casting a harsh spotlight on the struggles of low-income families, students and pensioners. A two-year fixed-rate deal for this amount - interest-only, over 25 years - will cost you £83.33 a month less with BM Solutions."After 18 months, you have covered the £1,449 fee," adds Ms Bien. "Over the two years you save £550, and the savings are even greater on a larger mortgage."Simon Tyler from Chase de Vere Mortgage Management, a broker, says the Barclays deal is pretty good for people looking to borrow a high percentage of the property value and needing to keep upfront costs to a minimum.But those with bigger deposits, he adds, could consider a two-year fix from Portman building society at 4.15 per cent, while remortgagers should look to the Halifax, which has a two-year fixed rate of 4.29 per cent.Consumers should be aware of the total cost of the mortgage, says Ms Bien, taking both rates and fees into account.. The Halifax, Bank of Scotland and Nationwide building society have also launched fee-free deals.But Melanie Bien, at broker Savills Private Finance, warns that while these offers sound great in theory, customers need to watch out for the rate of interest charged."Lenders have to make their money somewhere, and there are better deals out there than those offered by Barclays and Woolwich - even if you have to pay a fee."BM Solutions, for example, recently launched a two-year fixed-rate deal: it has a high arrangement fee, £1,449, but an interest rate of just 3.89 per cent.Even if you take out a mortgage of just £100,000, says Ms Bien, a loan from BM Solutions will work out cheaper than the new Barclays product.
But even this is 10 per cent lower than during the previous year."Our findings suggest Britons will be spending sensibly," says Morgan Stanley spokesman Patrick Muir. "This prudence may mean a leaner Christmas, but it is just as likely to reflect the growing savviness of shoppers who now demand more for their money.". If you're buying a new home and feel as though you're paying out money left, right and centre, then the idea of a fee-free mortgage may sound very attractive. For a cash-strapped first-time buyer in particular, an arrangement fee can feel like insult has been added to the injury already sustained by their wallet. Last week, Barclays and Woolwich joined the growing number of high-street lenders now offering fixed-rate home loans with no arrangement fee, with the launch of a two-year deal at 4.89 per cent, and a five-year deal at 4.99 per cent.These offers follow hot on the heels of a two-year fix at 4.79 per cent from Alliance & Leicester, and a five-year fix at 5.19 per cent from Cheltenham & Gloucester - launched earlier this month. Findings from Morgan Stanley show consumers will spend an average of £940 over the next three months - 10 per cent less on their plastic than during the same period last year.The biggest cut will come in socialising, with people expecting to spend a third less on going out.Shoppers also plan to reduce their credit card spending on clothes, shoes and health and beauty.The number one credit card spend in the final three months of the year will be on groceries, with consumers spending an average of £234. This cost, it added, was ultimately passed on to consumers through higher prices.The competition watchdog has issued a statement of objection about the fees, and the parties involved now have the chance to respond before a final decision is made.Colin Grannell, managing director of Visa, said: "We do not agree that the rates are unduly high."Last month, the OFT ruled that a collective agreement between MasterCard and its members was anti-competitive.It said that between March 2000 and November 2004, they were setting the fee too high so they could recover costs elsewhere - such as those incurred by interest-free periods.Child careFathers with new babies could take three months' paid paternity leave - and another three months unpaid - under new plans published by the Government last week.At present, men are allowed just two weeks' paid leave - at a statutory minimum of £106 a week - but under the proposals published last Wednesday in the Work and Families Bill, fathers would be paid for a full three months instead.Trade and Industry Secretary Alan Johnson said the proposals in the Bill would help parents balance the demands of their jobs with those of caring for their children.Under other plans in the Bill, new mothers could see their paid statutory maternity leave increased from six to nine months (and ultimately to a year by the end of this parliament).The Bill would also allow fathers to take the whole second six months' leave instead of mothers - if, say, their spouse was in a better-paid job.Mr Johnson said men want to be more involved with their new-born babies, and if the mother chooses to go back to work after the first six months, the father could then pick up extra paternity leave.He added that the DTI had consulted widely with businesses.Due to come in during April 2007, the Bill would also increase flexible working arrangements for parents and carers.SpendingBritons are planning to tighten their belts this Christmas by cutting their credit card spending. These are encouraging signs that the bottom will not fall out of the housing market, and that lending figures will continue to gain strength."Credit cardsThe Visa credit card network has come under fire for charging too much every time consumers make a transaction.The Office of Fair Trading said an agreement between Visa and the banks that issue cards breaches competition law.The dispute concerns the "interchange fee", which covers the cost of handling card transactions and is levied on retailers each time shoppers make a purchase.The OFT said the agreement led to an "unduly high fee" being paid to the banks.
