Debt worries continue as personal insolvency rises
The number of people becoming insolvent has risen by more than 22% in the past year according to new Government statistics.
Figures released by the Insolvency Service show that personal insolvency is increasing. A total of 22,503 individuals became formally insolvent between April and June 2016, compared with 18,382 in the same period last year.
The increase has been largely driven by a sharp rise in the number of people using an Individual Voluntary Arrangement (IVA) to deal with unaffordable debt. An IVA is a way of re-scheduling mounting debts and can including the writing-off of debt which would take more than five or six years to repay.
Commenting on the figures, South Yorkshire-based debt expert Paul Moorhead of Graywoods said, “The number of people becoming insolvent has risen steadily over the past 12 months, despite low interest rates, falling unemployment and rising wages. These figures show that many people are still struggling to cope with debt, perhaps because they became over-indebted before the Credit Crunch, or because a sudden change in their circumstances has caused them to become over-reliant on credit.
“Whatever the cause of debt problems, the good news is that help is available for anyone who is struggling with unaffordable debts. Taking advice from a licensed debt expert is the first step in solving debt headaches.”