Number of bankruptcies in England and Wales falls - but why?

According to statistics released on Friday last, 27,390 people in England and Wales applied for bankruptcy in the second quarter of 2012 which represents a drop of 10% from the same period last year and the lowest number recorded in a quarter since 2008. Now, given that we are in the worst recession since the 1930s - allegedly - one cold be forgiven for thinking this statistic is counter intuitive. Surely as the the economy worsens shouldn't the number of people declaring bankruptcy be on the rise? Conventional wisdom would tend to agree and so we have begun to believe there may be another reason for this decrease: the cost of going bankrupt is, ironically, prohibitively high. It may surprise some people to learn that going bankrupt in England and Wales actually costs money. Firstly there are court fees of £175 and a further deposit of £500 is also required, which means, to lose everything will actually cost about £700. And this, of course, assumes you do all the paperwork yourself. If you engage an Insolvency practitioner to assist, his fees could run into several thousands of pounds too. For this reason, it is believed that the fall in the number of bankruptcies may be more down to people not being able to afford it and choosing wither to lumber on or opt for the lower cost Debt Relief Order instead. It does then beg the question why it costs so much. To go bankrupt is a significant event not just in the life of the bankrupt person but also that of their creditors. The costs are incurred to ensure a line is accurately drawn under their affairs to date to that all parties can move on. Indeed, managing a bankruptcy well can be very beneficial for the person involved if it means they reduce their debt burden and associated stress and can begin anew. With appropriate measures in place they can begin to rebuild their credit history more quickly and hopefully get themselves to a position of being eligible for credit sooner. This is the advantage of managing a bankruptcy correctly and while it can be done by the individual themselves, for those who feel they would like assistance this is something they often feel is worth paying for. At Choie Loans we can assist those suffering from debt problems by looking at a range of options from a Debt management plan to an IVA (Individual Voluntary Arrangement) or, if required, bankruptcy. To enquiry or to speak to someone about your options at no upfront cost or obligation either complete our Debt Management Enquiry form or call us on 0845 1260350