Personal insolvency stats take first drop since 2008

Personal insolvency figures fell for the first time since Q4 2007 quarter on
quarter, according to the Insolvency Service.

There were 34,743 individual insolvencies for Q2 2010. However, this is a
decline from Q1’s 35,682 total.

The figures were comprised of 14,982 bankruptcies, 13,466 individual
voluntary arrangements and 6,295 debt relief orders.

Bankruptcies declined to 14,982 in Q2 2010 compared with 18,256 for Q1 2010,
and 18,870 for Q2 2009.

Both debt relief orders and individual voluntary arrangements increased in Q1
2010 compared with the previous quarter, and the same period a year ago.

Deloitte personal bankruptcy specialist Louise Brittain said that despite the
lower figures, a high level of individual insolvencies would continue for the ”
foreseeable future”.

Brittain predicts the country will see a rise in the number of personal
insolvencies in the second half of this year, with an estimated end of year
figure of 140,000.

“The cost of filing for bankruptcy currently stands at £600 – this is not an
insignificant amount, and as a result we may see an increase in IVAs as the IVA
market adjusts its pricing to make it more cost effective than bankruptcy,” she
said.

Further reading:

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sets up insolvency support for practitioners

Louise
Brittain to probe bankrupt Colin Hendry’s finances