Insolvent individuals turning to IVAs
According to recent Insolvency Service figures, the number of private individuals becoming insolvent has risen by around 4 per cent since the beginning of the year, driven by an increase in individual voluntary arrangements (IVAs).
Although 26,030 people became insolvent in England and Wales in the third quarter of 2013, the number is still 7 per cent lower than during the same period a year ago. Additionally, two other types of formal personal insolvency; bankruptcies and debt relief orders (DROs), have continued to fall.
Some 76,763 people have become insolvent this year so far and despite the recent uplift in the figures, if they remain much the same into winter it will still mean that the overall total for this year will be lower than the 109,000 people who became insolvent in 2012, which was the lowest annual figure recorded since 2008.
However, within the new figures, there were 13,394 IVAs recorded, marking a 6 per cent increase on the same period last year and the highest number seen in more than three years. In the third quarter there were 6,004 bankruptcies, 6,632 DROs and 13,394 IVAs.
DROs, often called “bankruptcy lite”, which are aimed at people with debt of less than £15,000 but no realistic prospect of paying it off, were down 15 per cent from a year ago and the lowest figure in almost three years.
It is always recommended that individuals seek professional advice on matters relating to debt and insolvency.
At Royds, our experts can provide expert advice on insolvency situations such as the options available for individuals to manage their debts.
Keeping you informed on Royds Withy King legal news, events and opinion.