Good IVA Advice Needed as Four Minute Bankruptcy Mark Broken
Press Release: Good IVA Advice Needed as Four Minute Bankruptcy Mark Broken
Release Date: 1 November 2009
In a grotesque parody of Roger Bannister’s momentous shattering of the four-minute mile in 1954, money education charity CreditAction reported that, for the first time, a similar milestone had been smashed for bankruptcies in the UK.
For the first time since records began, someone is declared bankrupt or insolvent in the UK every 3.97 minutes.
Leonie Kenner, spokesperson for the debt help service Best IVA Advice, said that this was a surprise waiting to happen. “Even though the statistics showed an upward trend and that this was probably going to happen, it’s still such a shame that people are pushed into this course of action. Bankruptcy is such a severe option when gentler measures such as IVAs are readily available”.
IVAs, or Individual Voluntary Arrangements, were created with the 1986 Insolvency Act as an alternative to the more draconian options of bankruptcy and sequestration. IVAs have proved popular, with around 4,000 IVAs expected to be started every month on average from late 2009.
Bankruptcy is still viewed as the ‘nastier’ option, and the stigma of bankruptcy is still real despite the number of bankruptcies rising, as this month’s figures show.
“It is important for people to consider the long term implications to what they are doing”, says Kenner, “and this is just as important as lenders to maintain strong quality control standards in deciding whom to lend to.”
The four-minute bankruptcy record means that now around 11,000 people are declared insolvent or bankrupt every month in the United Kingdom.