A record number of people filed for insolvency throughout the first three months of 2006, up 73 per cent on the same period of last year.
Altogether, more than 23,000 people filed for insolvency, with two-thirds opting for the most serious condition of bankruptcy, said the government’s Insolvency Service.
The number of people filing for Individual Voluntary Agreements (IVAs), under which they and their creditors cancel part of the debt in return for agreed instalments on the rest, also rose.
Analysts said that the national debt burden had been compounded by higher unemployment, and that the number of personal insolvencies could hit 100,000 in 2006.
The figures show that the country has now “borrowed to its limits” said Howard Archer of analysts Global Insight.
“There is a very real danger that individual insolvencies and mortgage repossessions will climb markedly further over the coming months,” he added.
The number of companies filing for liquidation has also sharply increased to 3,439 in the first quarter, 17 per cent up on the same period of last year.
Borrowers with finance trouble could find the best rate loan to simplify their outgoings.
© Adfero Ltd