Insolvency | Insolvency figures hit new high

Amidst the turbulent elections and hung parliament and the growing economic crisis across Europe, it has certainly been an eventful week!

Getting away from the continued election debates, last week the Insolvency Service released its latest statistics which showed that more than 35,600 people became insolvent in the first three months of the year 2010. This is equivalent to 566 people a day and what is more disturbing is the fact that the figure is expected to rise higher in the coming months.

This was the fifth consecutive quarter during which the total insolvency figures have hit a record level. Individual insolvencies were up 17.9% on the same quarter last year due to the increasing numbers of consumers trying to meet their debts.

Debt relief orders (DROs), which were introduced in April last year to enable people with debts of less than £15,000 and minimal assets to write off their borrowing without entering into a full-blown bankruptcy, also witnessed an increase with a total of 5,644 people opting to use one, signifying a rise of 6% on the last quarter of last year.

The 2009 saw a total of 134,142 individuals declaring insolvency and despite the recent signs of recovery shown by the economy, they are expected to remain high this year.

Given the above figures, it becomes all the more imperative for people in a bad debt situation to seek expert debt advice on how to deal with their financial problems. There are many debt management companies in the UK that provide specialist advice on debt solutions such as IVA, Debt Management Plan and debt consolidation etc. Seeking debt advice before it is too late can help you regain control over your finances and prevent the situation from snowballing to an extent where you are forced to declare bankruptcy.

Nigel