Record Number Of Personal Insolvencies 2008

	Do you live in Scotland? As Scotland has its own legal system, distinct from that of England and Wales, laws relating to bankruptcy are different too. In Scotland, personal bankruptcy is known as sequestration.

More news Bailiffs to get more powers but not much needed regulation Citizens Advice warns Citizens Advice Bureau reports sharp rise in debt problems Record number of people going bust - and it's set to get worse More than a million householders use credit card borrowing to pay their mortgage or rent Number of CCJs issued hits ten year high Number of Scots going bankrupt hits record high	Advice agencies struggle to cope with rising number of middle class debt problems Advice agencies who used to see mainly benefit claimants and social housing tenants are seeing increasing numbers of middle class people approaching them for debt advice. Community Money Advice (CMA), which supports money advice services across the UK and Ireland, has seen an 85% increase in people seeking help in the twelve months up to December 2007, with big increases in affluent areas such as Tunbridge Wells (up 234%), Cambridge (up 55%) and Horsham (up 48%). And one of its centres in Haywards Heath has had to close its doors to new cases because of the dramatic increase in demand. “We are seeing a new type of client," said Heather Keats, Director of Community Money Advice. "Teachers, police and banking and service sector workers, many of them homeowners, are struggling with mortgages, secured loans, and credit card debts. They were already financially stretched but have been pushed over the edge by dearer credit and big increases in food and utility costs.” Easy money, borrowed to pay for extras and luxuries is a big contributor to the problem, according to Richard Blake of Meridian Money Advice in Greenwich. “Many of the people we are seeing borrowed money over the past couple of years simply because they could. I had a young semi-professional in last week who owns her home and had borrowed £25,000. When I asked her what she had borrowed the money for she couldn’t tell me. We never saw this kind of thing until recently." Chris Tapp of Credit Action, which offers debt advice over the phone, says problems affecting home owners have resulted in a big increase in workload. “The whole face of the debt problem is getting uglier. We are dealing with many more mortgage problems and repossession hearings which are more complicated and take far longer to deal with than other credit issues.” “The need for free debt advice has always outstripped supply, but it’s hard to see how services that are already seriously overstretched will cope with this extra demand," said Faith Reynolds of Transact, an umbrella group for oprganisations fighting financial exclusion. "There will need to be more funding for debt advice, but no less importantly, much more investment in financial capability to help people find their way through an increasingly complex financial system and get the money management skills they need to stay out of debt in the first place.” May 16th 2008

More news

Bailiffs to get more powers but not much needed regulation Citizens Advice warns

Citizens Advice Bureau reports sharp rise in debt problems

Record number of people going bust - and it's set to get worse

More than a million householders use credit card borrowing to pay their mortgage or rent

Number of CCJs issued hits ten year high

Number of Scots going bankrupt hits record high

Advice agencies struggle to cope with rising number of middle class debt problems

Advice agencies who used to see mainly benefit claimants and social housing tenants are seeing increasing numbers of middle class people approaching them for debt advice.

Community Money Advice (CMA), which supports money advice services across the UK and Ireland, has seen an 85% increase in people seeking help in the twelve months up to December 2007, with big increases in affluent areas such as Tunbridge Wells (up 234%), Cambridge (up 55%) and Horsham (up 48%). And one of its centres in Haywards Heath has had to close its doors to new cases because of the dramatic increase in demand.

“We are seeing a new type of client," said Heather Keats, Director of Community Money Advice. "Teachers, police and banking and service sector workers, many of them homeowners, are struggling with mortgages, secured loans, and credit card debts. They were already financially stretched but have been pushed over the edge by dearer credit and big increases in food and utility costs.”

Easy money, borrowed to pay for extras and luxuries is a big contributor to the problem, according to Richard Blake of Meridian Money Advice in Greenwich.

“Many of the people we are seeing borrowed money over the past couple of years simply because they could. I had a young semi-professional in last week who owns her home and had borrowed £25,000. When I asked her what she had borrowed the money for she couldn’t tell me. We never saw this kind of thing until recently."

Chris Tapp of Credit Action, which offers debt advice over the phone, says problems affecting home owners have resulted in a big increase in workload. “The whole face of the debt problem is getting uglier. We are dealing with many more mortgage problems and repossession hearings which are more complicated and take far longer to deal with than other credit issues.”

“The need for free debt advice has always outstripped supply, but it’s hard to see how services that are already seriously overstretched will cope with this extra demand," said Faith Reynolds of Transact, an umbrella group for oprganisations fighting financial exclusion. "There will need to be more funding for debt advice, but no less importantly, much more investment in financial capability to help people find their way through an increasingly complex financial system and get the money management skills they need to stay out of debt in the first place.”

May 16th 2008

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