The number of people declaring insolvency rose to more than 30,000 in the first quarter of 2007. This is a rise of 23.9% over the same period in the previous year and a record figure.

Many of these insolvencies are the result of an increase in the number of Individual Voluntary Arrangement. Many people have been persuaded that an IVA is an easy option to get out of debt from watching TV adverts and advertisements in the newspapers but the banks and financial institutions are hardening their line on IVA’s. The companies that encourage their use are being closely monitored by the authorities due to concerns that some of the advertising was misleading.

The rate of growth in insolvency is slowing a little which is very likely the result of the hardening attitude of Banks on IVA’s but the recent rises in interest rates with more rises expected will do nothing to reduce the problems for those people who are financially over extended and further increases of the numbers of people declared insolvent are a likely .

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Filed under: Debt • General

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