People in UK who have saddled themselves with debt are falling behind with loan and mortgage repayments as the economy slows, a charity has warned.

The Consumer Credit Counselling Service (CCCS) reported that the number of people who had fallen behind with debt repayments had been steadily rising this year.

The debt charity blamed a slowing economy and firms cutting back on overtime for the worsening situation.

If the economy continued to stagnate or went into recession the charity warned that increasing numbers of people were likely to face problems servicing their debt.

Management failure

According to the Leeds-based charity, last autumn the number of their clients unable to keep up with their tailored debt management plans was at a record low level.

With Christmas approaching it is important that people think carefully about their budget before embarking on a spending spree

Malcolm Hurlston, CCCS chairman

However, since then the percentage failing to stick to their debt management plans has risen to 12.3% from 9.4% a year ago.

At present the charity has 30,000 people on debt management plans and receives 150,000 calls a year from people in debt.

Record borrowing

The charities warning comes hot on the heels of the Bank of England announcement that unsecured borrowing in the UK had reached record levels.

Unsecured debt rose by more than �2 billion during September to nearly �153bn.

Malcolm Hurlston, chairman of the CCCS warned: "With Christmas approaching it is important that people think carefully about their budget before embarking on a spending spree."