Personal insolvencies in Scotland fall to a four-year low
March 15, 2013
If you’re suffering with personal insolvency worries, it’s always best to speak with a qualified adviser to help try to resolve your personal situation.
However as personal insolvencies drop to their lowest level in four years, statistics from Scotland’s insolvency service, the Accountant in Bankruptcy, suggest that Scotland is cautiously optimistic about the future.
Despite 3,855 personal insolvencies taking place in the final three months of 2012, a fall of 5% compared to the same period in 2011.
Debt experts argue that a large part of this decrease is due to a significant drop in sequestration in Scotland. Since the first quarter of this financial year, the number of sequestrations being undertaken fell by 44%, and by 35% compared with the same quarter in the 2011/12 financial year.
In June 2012, the cost of sequestration in Scotland doubled from £100 to £200, something which may have impacted on the number of applications. The Debt Arrangement Scheme (DAS) has also become increasingly popular throughout 2012, approving over 1,000 debt arrangement plans in quarter two.
The DAS allows a debt payment to be spread over a longer period of time and is used as an alternative route to Trust Deeds or bankruptcy (sequestration). It is also normally considered a cheaper alternative.
The number of Trust Deeds undertaken in Scotland rose by 2.9% during 2012, indicating that there are still many Scottish residents struggling as a result of frozen salaries combined with a higher cost of living.
Fergus Ewing, minister of energy, enterprise and tourism in Scotland, argues that though insolvency levels are falling, people should still remain cautious. He said: “We must not forget that many Scottish families are still struggling with unmanageable debt and often the financial impact of Christmas is felt in January and February.”
Despite a significant drop in personal insolvencies in the last three months of 2012, there are still a substantial number of people in Scotland struggling to make ends meet. Mark McFayden, Trust Deed expert at UK Trust Deeds said: “These are very worrying figures, a fall in the number of personal insolvencies are only part of the picture…many people continue to struggle with high levels of unsecured debts and put off the decision to seek debt advice, in the hope that their circumstances improve.”
If you’re struggling to keep your finances under control, why not contact our experienced team at Scotland Debt Solutions for impartial advice and to consider the most appropriate solution to ease your debt worries.
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