Almost two out of three people who take out a loan to consolidate their debts go on to borrow more while still repaying that loan, according to research by comparison website moneysupermarket.com.

With the cost of essentials, such as food, fuel and electricity, rising in price the fastest, more and more people are finding it hard to cope financially. One in nine borrowers say they feel unable to do anything about their debt, while a further ten per cent say they feel their debt is spiralling out of control.

More than two thirds of borrowers are unable to obtain a loan through their chosen mortgage broker, as struggling brokers find it impossible to to find loans for their customers because of the credit crunch.

A survey by the IMLA, the Intermediary Mortgage Lenders' Association, a trade body representing the interests of lenders who market their products primarily through brokers, found that 68% of mortgage brokers were unable to source a mortgage for clients in the past two months.

Struggling families are being left with only the most expensive borrowing options as lenders cut back. Moneynet.co.uk has warned that anyone tempted will be hit by exorbitant interest rates of up to 1,355%. The biggest villains are pay-day loans. They are usually for small amounts, from around £100 to £1,000, which are repayable on the borrower's next pay day. The only requirement is for applicants to have a job which pays a salary into a bank account with a cheque book or debit card.

The new "58" vehicle registration plate, released today, may not be snapped up as quickly as previous issues. Experts believe that, although motorists will be keen to get their hands on a new car, fewer may be able to realise their dream because of the credit crunch.

Mark Huggins, Head of AA Personal Loans, says: "The current financial climate leads us to believe there will be a drop in the number of new cars bought this year compared to last year.”

Struggling people used to turning to their relations for loans are discovering the family bank is shut. Families can no longer afford to help each other out with loans or financial help, the Chelsea Building Society reported today. Instead family members - hit by the rising cost of living - are offering other types of support and assistance, aimed at helping out.

As many as  450,000 mortgage and loan customers apply four or more times to be accepted, while as many as 3.4 million borrowers have been turned down at least once for mortgages and loans in the past 18 months, GE Money Home Lending research shows.

One in eight of them had to apply four or more times before they were accepted for a mortgage or loan, while more than 412,000 could not get a mortgage or loan despite repeated attempts.

Hobbies are burning a hole in the pockets of cash-strapped Brits, with the average cost of an active hobby in the UK working out at almost £280 a year. 

According to research from Yorkshire Bank, golf is one of the most popular, but also one of the UK's most expensive, active hobbies. While costs can vary from club to club, a passion for golf costs an average of £755 per year - £275 more than its nearest rival, which is going to the gym.

Consumers taking out best buy unsecured personal loans could expect to pay £1.2bn more in interest than they would if they had taken out the loan just over a year ago.

The interest rate payable on the best deals has gone up in that time from just 6.1% APR to 7.4% APR for £8,000 over four years, according to research by Switch.com, the price comparison and switching site.

Rates on personal loans have increased sharply in recent months, and borrowers are now facing the highest repayment levels for six years.

The lowest rate currently obtainable for a £5,000 loan over three years is 7.6% APR from Moneyback Bank, according to Moneyfacts, the independent personal finance information provider. But many consumers going straight to their bank could be paying a much higher price. The same bank was charging 6.3% a year ago, and 5.6% in August 2006.

The number of people spending more than 30% of their monthly income on unsecured debt re-payments has doubled over the past year, to 14% of the adult population, according to independent research commissioned by credit reference agency Callcredit.

The increase in the number of people using more than half of their monthly income to service unsecured debts has been even more dramatic, tripling from just 2% in September 2007 to 6% today.

Unscrupulous doorstep lenders are cashing in as personal loan rates continue to increase. In the last month alone eight major personal loan lenders have raised rates and tightened credit criteria, giving many struggling families little choice but to turn to expensive payday loans or rip-off short-term finance deals.

In spite of the crunch on credit, coupled with a rising cost of living, more than two-and-a-half million British adults are getting into debt each time they go on holiday - twice as many as the 'pre-crunch' hazy summer days of last year. This is according to a recent report from CreditExpert,  the online credit monitoring service from credit reference agency Experian.

Based on a survey of 1,047 adults, the research found that 18 to 24 year-olds are most likely to fall into debt over a holiday. A third (33%) of this age group admitted they succumb to peer pressure and are 'afraid of letting people down'.

Research from Alliance & Leicester has revealed the average cost of a wedding has soared to a staggering £19,400. With an estimated 275,000 couples in the UK getting hitched each year, according to the Office for National Statistics, weddings are big business. 

But, according to separate research from financial website Fool, one in 10 people would be prepared to slap the whole cost on a credit card or personal loan in spite of the worsening credit crunch. Perhaps more worrying still is that, despite house prices falling – by 2% in June, according to Halifax – a further 3% of couples would take out a remortgage or second loan to enable them to foot the bill. But on the top of a mountain of debt is no way to start married life – so what measures can you take to achieve a perfect day on a less than perfect budget?

How to cut the cost of a wedding

Frugal is the new flash; do you need a prepaid card?

Barclays is to close its First Plus secured loans business to new customers from 9 August. The lender blamed slow demand for its decision, which will involve making 300 people redundant in Cardiff. First Plus has 128,000 customers, with £4.7bn of loans outstanding.

"First Plus's announcement that it will not accept any new business from 9 August is a huge blow to the debt consolidation market,” said Tim Moss, head of loans at price comparison site moneysupermarket.com.

The rising cost of mortgages and rent has forced 7% of people to take out a personal loan in the past year, according to research out today from moneysupermarket.com. It also found that a further 9% of people have had to spend a lot more on their credit cards because of increased housing costs. Worst hit are people in their forties - 20% of whom have been forced to turn to loans or credit cards to keep their heads above water as the credit crunch bites harder. And the situation is likely to be exacerbated by £30 billion worth of mortgage deals coming to an end in July and facing higher monthly repayments.

The days of cheap personal loans are over, according to new research from Moneyfacts. It reported today that the last of the 7% priced loans, that had been available from Yourpersonalloan.co.uk - a website funded by The Co-operative Bank - had now increased from 6.9% to 7.3%.

Michelle Slade, analyst at Moneyfacts, said: "Back in June 2006 rates as low as 5.6% were on offer, and even this time last year rates as low as 6.1% could be found. Today the lowest rate on offer is from The AA on its telephone loan at 7.2%."  A personal loan of £10,000 over five years would now cost a consumer £423 more over the term of the loan than it would have done two years ago.

CashQuestions.com began a new series in the Express newspaper on 25 June, answering readers' questions. Keep an eye out every Wednesday for the CashQuestions column called Money Matters.  

Desperate parents are expected increasingly to turn to personal loans to meet the rising cost of school fees. Last year they rose on average by 6.2%, to around £11,250, and around 18,000 loans, worth an estimated £165 million, were taken out to pay the bills. Research by Sainsbury's Bank expects an even greater reliance on loans in the coming year.

Analysis of Government data by the bank reveals that households are  spending more and more on education fees.  It estimates that in 2006, the latest statistics available, total UK household expenditure on education fees was £8.89 billion.  The average annual figure for the period 2002-3 to 2004/05 was £6.73 billion – a difference of £2.16 billion, or 32%.

Cars are the biggest culprits when it comes to tempting people into spending beyond their means, according to a consumer survey by Experian, the global information services company.

The research reveals that men are nearly twice as likely to get into four-wheeled debt than women.

Despite the rising costs of living and the spiralling costs of running a car, a third of UK adults admit to being influenced by how people perceive them and would most likely get themselves into debt just to give the impression that they are wealthy.

A fall in the number of mortgage transactions, increasing interest rates on credit products and tougher lending conditions have meant a 17% fall in the number of household and financial products being switched in the past year, as the credit crunch hits home.

In the first quarter of 2008 a total of 32.2 million household bills for a range of basic services were moved to other providers, compared with 38.9 million in the first quarter of 2007, according to the price comparison website MoneyExpert.

Lenders have turned down almost 1.4 million loan applications in the past six months, according to MoneyExpert. People with poor credit histories are finding it increasingly difficult to secure a loan.

At the same time, lenders have raised their rates by up to 1%, despite three rate cuts by the Bank of England since December.

Teenage children are gearing up to take on credit cards, loans and overdrafts when they turn 18, despite not being able to undertake basic budgeting tasks, according to a new study by the AXA Financial Task Force - an independent group of psychologists, economists and industry experts.

The study found that as many as 44% of 15 to 17 year-olds are planning to take out a credit card when they become an adult; 18% are thinking of taking out a bank loan when they turn 18 and a further 17% expect to be overdrawn.

But the findings of a separate investigation into the financial habits of 15 to 17 year-olds, also by Axa, reveals that teenagers are unable even to stick to a basic budget for the week.

Debt counselling services are being overwhelmed with pleas for advice from middle-class families in financial difficulties, as they contend with inflation, credit card bills  and the downturn in the housing market.

Transact, a national organisation representing more than 1,000 financial counselling services across the country, told the Daily Telegraph that some of its members had been forced to close their books as they were struggling to cope with the caseload.

The number of court judgments against people who are failing to pay their bills are soaring, as mortgage rates rise and the  cost of living mounts.

County Court Judgments (CCJs) in the Shoreditch court rose by an astonishing 154% in the first quarter of this year alone compared with the previous quarter. Other areas seeing a massive increase in judgments for unpaid bills are Lanark, Barrow-in-Furness, Aberystwyth, Stirling, Peterhead and Crewe.

Payday loans are tempting an increasing number of borrowers, as cashstrapped householders find it harder to make ends meet.

The loans are cash advances against wages you have yet to receive. Once you've been paid you repay the loan, either by a post-dated cheque or by debit card.

Payday loans are available for extremely short-term borrowing - usually a maximum of a 30 days - and can be an attractive option compared with unauthorised borrowing. Research by comparison site Moneysupermarket shows there has been an increase of more than 55% in applications for these loans since September.

Nationwide Building Society is the latest lender to increase its personal loan rates. Its cheapest loan is now 8.9%, a full percentage point higher than before, and its most expensive is 17.4%, depending on the amount being borrowed.

The move follows a hike by Black Horse, which increased rates for some smaller loans by an eyewatering 11.0%, while NatWest has upped rates on larger loans by 1.5%, adding £1,015.20 to the total cost of a £25,000 loan over five years.

Interest rates and monthly repayments on personal loans are increasing as fast as mortgage rates, as the credit crunch hits unsecured lending as well as home loans.

Michelle Slade of data provider Moneyfacts says: "Since the beginning of the year more than half of lenders offering personal loans have made changes to their rates. Black Horse has increased rates for those looking for smaller loans by as much as 11 percentage points, adding £52.68 in interest on a £1,000 one-year loan. NatWest has increased rates on the largest loans by 1.5 percentage points, adding £1,015.20 to the total cost of a £25,000 loan over five years."

One million people have problems with  unsecured debt averaging £25,000 each, bringing the total of problem debt in the UK to an astonishing £25 billion, a new report has found.  The compilers of the report, TDX Group,  claim that changing economic conditions will result in growing numbers facing financial difficulties this year, an increase on the 400,000 people who sought drastic solutions to their debt, such as bankruptcy and individual voluntary arrangements, in 2007.

Anyone thinking of taking out a loan will soon be able to ask for a customer information sheet from their broker.

The Association of Finance Brokers has published a fact sheet for that brokers can hand to their clients, which includes details of:

M&S Money is offering a cashback reward to customers who take out a personal loan between 1^st  April and 3^rd June 2008.

The offer is available on all personal loans taken out over 36  months or more, giving back to customers 25% of the interest they have paid once their final repayment has been made.

When the cashback reward is taken into account, the typical rate of 8.9% APR on loans between £7,500 and £20,000 is equivalent to a rate of just 6.9% p.a.

Just two weeks ago the FSA suggested that the days of cheap credit were over. The latest Moneyfacts.co.uk research into the cost of unsecured personal loans underlines that this is certainly the case.

Michelle Slade, analyst at Moneyfacts.co.uk, says: “In the last year rates on unsecured personal loan interest rates have continued their upward trend. Average rates for all loan amounts are now up to 4.6% higher than they were in March 2007.

Research by fraud prevention service CIFAS shows that more people are lying on application forms to obtain credit, insurance and other products; that they are getting into financial difficulty sooner; and are turning to fraud at an earlier age.

The research looked at the application fraud cases filed on the CIFAS database, comparing the situation in 2004 with that in 2007.

Large increase in number of application fraud cases

The number of application fraud cases filed on the CIFAS database increased from 62,000 in 2004 to 77,000 in 2007, an increase of more than 24%.

In each of these cases, individuals had told lies (" material falsehoods" ) on the application form, or had supplied false or altered documents to support their application.

New figures from Unbiased.co.uk, the find-an-independent-financial-adviser search, show that, as a nation, we have worked the last 70 days solid to earn enough money just to service the interest on our credit card and loan debt, let alone re-pay the actual debt itself, and thus Monday 10th March is hailed as Debt Freedom Day. 

Fewer people intend to buy a car in the next six months, research has found and those who do intend to buy will spend less than at any time in the last three years.

The findings are significant because 30% of car buyers intend to finance their purchase with a loan. The research estimates that the spend on cars over the next six months is set to decrease by £11.1 billion compared with the same period last year.

A leading claims management firm is predicting a new wave of new claims for compensation for  mis-sold loan protection insurance. BrunelFranklin also predicts further fines for payment protection insurance (PPI) vendors as millions of consumers become more aware that they have been mis-sold PPI.

Anthony Sultan, managing director of Brunel Frankin, said: “Companies cannot ignore the regulator with impunity and cannot expect to get away with it. Vendors cannot continue with the widespread mis-selling of worthless PPI policies that many consumers don't even know they have.

The head of the Financial Services Authority, Hector Sants, has warned that the UK’s era of cheap credit may be over forever.

In an interview with the BBC's Today programme Mr Sants said: “I don’t think markets are ever going to return to the way they were.”

The European Parliament today adopted new rules aimed at stimulating the EU market in consumer credit. Two out of three Europeans use credit to buy furniture, a washing machine or a car. But the vast majority seek lending only in their own country. The new directive should make it easier for people to compare