Consumers are $1 million more in debt this year over last year, according to a figure released by the Island?s largest debt collector this week.

While the Bermuda Credit Association [BCA has confirmed a Bermuda Broadcasting report that BCA?s bad debt portfolio has jumped by $1 million this year, the company declined to say how many consumers are on its debtors list nor what last year?s overall debt figure was.

Dora Whitecross, who manages the Island?s oldest debt collection agency said: ?At this time we are coming over as the Grinch and we don?t want to be there. That is not our mission at all.?

In 2001, the 400 some companies who used BCA handed over bad debts of $5.2 million for BCA to pursue. By October of 2002, BCA was chasing debtors for $3.75 million, with the numbers expected to soar by the end of the year.

Then as now it appears that phone usage is helping to push up consumer debt. Jodi Routledge, officer manager for Bermuda Debt Collection Agency, said that when it comes to debt collection, cell phone bills, long distance bills and doctors bills are some of the most common items to cross her desk.

?People in one month rack up a couple thousand dollars in phone bills, whether it be local or long distance charges,? Ms Routledge said. ?People let them slide.?

Department of Consumer Affairs education officer Rhonda Daniels said other factors such as the high cost of rent, housing and medical expenses that are not insured, could also contribute to the Island?s rising debt level.

?There is credit everywhere ? credit cards, charge accounts ? and Bermudians may be living above their means,? she said.

When it comes to debt her department advises consumers to do away with all their charge accounts and credit cards and stay on top of paying rent and utilities.

?Once you get behind on those it is hard to pay them back. If consumers do get into debt and they do have bills they owe, don?t ignore them. If an envelope comes, open it up and see what it is. If you are unable to pay the amount that they say or are having difficulty then call up the creditor before it goes to a debt collection agency and say I?m having difficulty paying this.?

For those who are struggling with several credit and loan payments each month, Butterfield Bank offers a consolidation loan to allow consumers to streamline multiple credit and loan payments into one monthly payment.

?A number of people in our community have become overwhelmed with debt from owning numerous credit cards and other loans,? said Eddie Belfon, Vice President, Consumer Lending. ?People who have accumulated large amounts of debt can find some relief from this burden by consolidating their many payments into one smaller, monthly payment.?

Mr Belfon suggested closing out credit cards and consolidating all debt into one low-cost loan.

?You can also take a loan in the form of a low-cost mortgage. These can be arranged for as low as six percent, a considerably lower interest rate than credit cards.?

Those who fail to pay what they owe risk being deemed a ?bad credit risk? and their accounts will be forwarded to companies such as Bermuda Debt Collection if their bills remain unpaid.

Ms Routledge said that, although her company seeks to work out payment plans with each debtor, the majority of cases end up as trials before Magistrates? Court.

She said: ?You have to try to assess each individual?s needs and some people really don?t have the money. With those people you have to be more lenient and understanding and work with the budget and if they can afford to pay $50 a week we try to work with that. If we know the person can afford to pay more and they just choose not to then that is somebody who you take to court straight away.?

Ms Daniels urges consumers to work with debt collection agencies.

?If your name goes to the credit company, call them and see what you can work out. They may be considered to be bad people, but nine times out of ten they are receptive to helping you reduce your debt.?

Ms Routledge said she was not surprised that debt has climbed by $1 million this year because too many people live beyond their means.

?To me it is not surprising when you deal with it every day. It really is not a shock. I?ve just been shopping recently for Christmas gifts and I saw people that I know have bills at my job and they are down at the Louis Vuitton store. Why are you down at Louis Vuitton when you tell me you can only pay me $20 a week. It is not like they are down there and somebody else is buying, they are at the counter pulling out the money.

? If I go to any bar on a Friday evening I walk in and I immediately see five people who owe bills. They can afford to buy drinks but they can?t afford to pay their bills??

Island Credit Service owner Cecil Downs also said the increase in debt unsurprising.

He said: ?A lot of people get anxious, they want to give especially around Christmas time. The credit card is the ideal answer for them but they have to realise they have to pay in the long run and that is what happens when it comes to January.?

Ms Daniels advice at this time of year: ?Be very cautious at this time of year especially with credit cards and charge accounts because it may sound like you are not going to be charged until the end of January, but when that bill comes you are going to have to pay it and if you have other bills that are similar to that then it is going to be hard for you to get out of debt.?