DON'T LOOK BACK IN ANGER

DON'T LOOK BACK IN ANGER A FUTURE OF FINANCIAL DEBT AS PAYBACK FOR STUDENT YEARS Over half of 18-30 years olds (63%) currently in debt blame their student years for their poor financial health, with over a quarter (28%) of those who regularly miss payments on their debts also citing this as the main cause of their debt. This is according to research from Kensington Mortgages, the leading UK non-conforming residential mortgage provider. These figures emerge at a time when consumer debt is reported to be soaring, with the average household £36,000 (including mortgage) in debt¹. The threat of this leading to many people finding themselves in deeper financial trouble, leading to further complications in life, is fuelled by expectation that the Bank of England will increase interest rates during the next year. People need to understand the implications this may have in later years. The findings are the latest from a study by Kensington Mortgages that asked a GB representative sample of 1,000 in debt to confirm the main causes of debt. . Key findings · With student life often involving trying to survive on a shoestring, 14% of the population claim their financial problems were caused by their time spent at university. Men are more likely then women to blame their debt on their student days (17% v12%). · With credit card providers making tempting offers such as low introductory rates and cashback options, for 12% of the population, credit card bills are the main reason for their debts, with people in their 40s and 50s most likely to blame it on the plastic (20%). · With some companies suffering a downturn in business, 6% said that their current debt problems were a result of being made redundant. · 6% said they are in debt because they missed a payment, thereby getting themselves into greater financial difficulty. · 4% of people blame their debt on having an expensive partner, with 9% of those between 35-44 attributing their debt to their loved ones. · While it is always tempting to spend, for 3% of people the main cause of their debt is ignorance, saying that they didn't realise the size of their debt as they let it mount. Regional findings: What the regions say is the main cause of their debt Region Too Easy Didn't Being Credit Job loss Missed Expensive to Borrow realise a card a partner Money extent of studen Bills Payment debt t North 57% - 11% 23% - 3% - Scotland 46% 8% 6% 9% - 21% - South 28% 3% 20% 10% 10% - 6% West London 31% 1% 13% 15% 12% 10% - South 42% 3% 6% 16% 4% 2% 7% East East 21% 8% 32% 8% 11% - 14% Midlands West 24% 4% 33% 2% 9% 3% 7% Midlands North 45% 2% 7% 12% 7% 10% 2% West East 31% - - 42% - - - Anglia Wales 42% - 13% 6% 4% 11% - Yorkshir 55% - 16% 9% - - - e Kensington Chief Executive, John Maltby, said: "The research indicates that there is a need to offer young people and students alike the opportunity to cope with their financial affairs before they snowball, thereby avoiding becoming financially burdened before they begin their careers. Young people need to be made aware of the problems too much debt can cause them in the future. This can cause serious issues when they are looking for a mortgage, the biggest and most important financial commitment they are likely to face. We aim to provide borrowers with the help that they need to get back on their feet by offering mortgages to people who have had difficulties and when conventional lenders won't help." ENDS For further information or to arrange interview: Rebecca Ellis-Owen @Financial Dynamics on 020 7269 7112 Caroline Long @Financial Dynamics on 020 7269 7239 Notes to editors *Bank of England figures 1. The research was undertaken by RSGB among a GB representative sample of 1,000 people, from 65 sampling points. 2. For more information on Kensington Mortgages, visit www.kmc.co.uk. Kensington Group plc Kensington Group plc is a publicly quoted company, which listed on the London Stock Exchange (ticker symbol "KGN") on 23 November 2000. Kensington Group plc trades under the names of "Kensington Mortgage Company" and "Kensington Mortgages". The business was founded in November 1994 and commenced trading on 1 September 1995. Kensington is a market leader in the non-conforming residential mortgage sector in the United Kingdom. It provides loans, secured on residential property, to customers who generally do not conform to the underwriting criteria of the traditional suppliers of residential mortgage loans. The company is classified in the Mortgage Finance sub-sector of the Speciality & Other Finance Sector. Best practice Kensington adopts a leading role on regulation. It is a member of the Council of Mortgage Lenders, which sets out standards relating to residential mortgage lending, and subscribes to its Code, which is voluntary. It is also registered with the Mortgage Code Compliance Board, which monitors compliance by lenders and mortgage intermediaries with the Council of Mortgage Lenders code. Kensington insists that all its business introducers adopt best lending practices, subscribe to the Council of Mortgage Lenders, and are registered with the Mortgage Code Compliance Board. Kensington Mortgages and Kensington Mortgage Company are trading names of Kensington Group and its subsidiaries. Registered in England (Company No. 3050321. Registered office: 1 Derry Street, London, W8 5HY). Kensington® is its registered trademark. ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2002/05/08/20020508BIT00050/wkr0001.doc http://www.waymaker.net/bitonline/2002/05/08/20020508BIT00050/wkr0002.pdf