SALISBURY residents are struggling amid mounting debts and rising numbers of repossessions.

The city has topped two national tables - for the highest level of personal debt outside the capital, and the biggest increase in actions launched to repossess homes.

Local people with money problems owe an average of £39,474, according to a survey by the financial advice company ClearDebt.

These are unsecured debts such as credit card borrowing, overdrafts and personal loans, and exclude mortgages.

Only in the City of London do people have higher unsecured debts, while the national average is far lower, at £26,576.

Meanwhile the number of people facing legal action from lenders threatening to take back their homes was up by 95 percent for the period April-June, compared with the same time last year.

Justice Ministry figures collected from the crown courts show that there were 41 possession claims issued in Salisbury in the first three months of this year, and a total of 73 in the first six months.

These cases do not automatically lead to a family losing their home, but can act as a threat to ensure debtors pay up.

But the number of actual repossession orders made from April to June was 29 - an increase on the same time last year of 123 per cent. Over the first six months of the year it was 53, a rise of 104 per cent.


"The more you earn the more you can owe"


"The more you earn, the more you can end up owing," he said.

"People borrow for a car or a holiday, then something changes in their lives such as redundancy or an uninsured loss and they can't they can't pay back their loans.

"Until now, places like Salisbury have seen significant rises in property prices which allowed people to imagine they had a large amount of equity. They could consolidate their debts by increasing their mortgage. That's not possible any more.

"People coming out of fixed term mortgages are having to pay 20-25 per cent more for a fixed rate home loan, or up to 40 per cent more for a variable rate.

"If you can't get rid of your unsecured debt, there's only one thing you can do - sell up. But it creates a buyers' market, and property prices plummet."


"Worse to come"


Mr Smith fears there is worse to come.

He said people tend to spend up to two years working out how to tackle their debts before they take action, so those taking part in his survey had problems that pre-dated the credit crunch.

"If the average debt in your area is higher than the average national income, you have an impending crisis, he warned.

"Only next spring will we really start to see the effects of the crunch. The sky will be black with chickens coming home to roost."

The Council of Mortgage Lenders said: "The number of people facing difficulty needs to be kept in perspective. Most people are coping well and continuing to pay their mortgages in full."