Loan sharks demand sex to pay debts

Jan 19 2009 by Emma McKinney, Birmingham Mail

The news comes as even legal creditors are getting tough as they desperately battle to survive the recession, with some banks and loan companies forcing people to go bankrupt or lose their homes over debts as low as £750.

Trading Standards officers at Birmingham City Council’s Money Advice Service have been inundated by distraught families on the brink of losing everything.

Now officers fear proposals under the Tribunals, Courts, and Enforcements Bill could enable creditors to push for bankruptcy at an even quicker rate and for even lower sums.

Chris Neville, head of Trading Standards, said the council is doing all it can to pressure the Ministry of Justice in a bid to stop the Bill from being passed.

“We will continue to lobby the Government over this,” he said. “We are already finding, as the recession bites, that whereas this time last year the credit companies would have allowed us to negotiate a payment schedule for someone who owed money, they’re now pushing for bankruptcy at an earlier stage than ever.

“People need to realise that any unsecured debt can result in them being forced to sell their house to settle a relatively small debt.”

He described new figures revealing the average Birmingham householder is £9,740 in debt, excluding mortgages, as “alarming”.

Last year Money Advice Service helped 424 people with a collective debt of £5.8 million, a figure which officers fear could double this year.