Latest figures have shown that individual insolvencies have fallen significantly year on year.
Data issued by the Insolvency Service on 7 February revealed that there were 24,282 individual insolvencies during the fourth quarter of 2013, down 4.6 per cent on the same period of 2012.
The number of bankruptcies in the quarter fell to 5,386, down by nearly a quarter (22.2 per cent) on 2012 while Debt Relief Orders (DROs) also reduced significantly, by 13.1 per cent, to 6,536.
But Individual Voluntary Arrangements (IVAs) bucked the trend, with the total rising by 12.3 per cent on 2012 to 12,333.
In total, there were 101,049 individual insolvencies in the 2013 calendar year, down by 7.9 per cent on 2012. As in the quarterly figures, bankruptcies and DROs were down throughout 2013 while IVAs increased and now make up more than half (51 per cent) of all individual insolvencies.
The figures suggest that individuals dealing with insolvency are increasingly opting for alternatives to bankruptcy. The Insolvency Service said that 2013 was the first year in which the number of DROs was higher than total bankruptcies and the third in which there were more IVAs than bankruptcies.
For anyone facing financial difficulties, seeking professional advice at as early a stage as possible can make all the difference, because more options will be available to resolve the debt or insolvency issue.
At Palmers, our experts can provide expert advice on all types of individual insolvency situations including individual voluntary arrangements, which are agreements with creditors to pay all or part of your debts over a period of time. The amount of debt involved is usually at least £15,000.