Number of bankrupties has fallen
New reports have revealed that the number of bankruptcies in the UK has dropped this quarter. This is great news, especially when it coincides with the news that the number of houses being repossessed in Wales and England has also fallen.
Home repossession orders have reduced by 1% in this quarter. The figure of repossessions still remains at over the 23,000 mark, but hopefully this is a sign that they will continue to drop. Having your house repossessed is usually due to homeowners being unable to pay their monthly mortgage or defaulting on any secured loans repayments. There had been an increase in homes being repossessed earlier in the year after some of the initial base interest rate rises.
Insolvencies have also noticeably dropped in number by 3% and is actually 5% lower than this time last year. And if that wasn't enough bankruptcy rates have also fallen by 2.1% and the number of IVA's in operation has been reduced by 4.3%.
These figures all look really good. Could it mean that as a nation we are finally starting to get back in control of our finances and managing our money better? There is a big difference between good debt and bad debt and we were certainly seeing cases of bad debt of companies and individuals spiralling.
Even credit card borrowing has been reducing recently, announced Pricewaterhouse Cooopers. However the council of Mortgage Lenders have predicted a rise in repossessions over the coming year. Homeowners are find it increasingly more difficult to pay mortgage payments as interest rates keep rising. It is thought this will push up the insolvency numbers again for 2008 as you generally cannot get one rise without the other following suit.
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