UK Debt Problems - Some Stocks Which Might Further Benefit
Posted: Monday 09 October 2006 - UK Shares Section
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As we all know the personal debt problem in the UK is getting out of hand. This has been due to many factors including reckless lending and promotion by the financial institutions.
Whatever the case the trend for rising bankruptcies is continuing and plenty of companies are lining up to take advantage. Check out these AIM listed firms –
- Debt Free Direct (DFD)
- ClearDebt (CLEA)
- Debts.co.uk (DETS)
- Debtmatters (DEBT)
Potential Mis-selling Risks
Some people are starting to suggest that Debt help companies especially those on the stockmarket are far too aggressive with their often unsophisticated clientele. For example, concerns have been raised that (very profitable for the debt company) Individual Voluntary Arrangements (IVAs) have been pushed on customers when straight bankruptcy would have been the more suitable option.
Debt companies are not regulated therefore it's always a risk that the Financial Services Authority will start to look at them and their business models in more detail leading to the possibly that they'l have to be regulated. If that happens it wouldn't be the best news for the sector.
Summary
Although the debt problem is not going away in the UK the stocks listed above are pretty extended on their charts alongside being valued for continuing rapid growth. For this reason we’d advise some caution about buying at these levels.
Still, the stocks are worth putting on your quote screen.
