Think Money

Think Money

June 15, 2010 06:01 ET

Bankruptcy not the only option for unmanageable debts

LONDON, UNITED KINGDOM--(Marketwire - June 15, 2010) - After Ministry of Justice figures showed that the number of bankruptcy petitions lodged by borrowers has increased significantly in recent years, financial solutions company Think Money said that this may reflect a greater awareness of the various options for tackling debt amongst the public.

The company added that people with unmanageable debts should discuss all their options with an expert debt adviser before they decide what to do.

In a recent report, the Ministry of Justice found that while the number of bankruptcy petitions lodged by creditors has remained fairly constant over the last five years, the number of lenders petitioning for bankruptcy by themselves has risen sharply.

In 2005, 37,000 people petitioned for their own bankruptcy, but by last year this figure had increased to 63,000. In the first quarter of this year alone, petitions by the borrower were 20% higher than in the previous quarter.

A debt expert at Think Money said:

"Bankruptcies have increased significantly in recent years, but it seems that an increasing proportion of this has been made up of borrowers themselves going to the courts about their debts.

"While increasing bankruptcies are clearly not a good sign, this does at least suggest that people are becoming more inclined to tackle their debts themselves - whereas in the past more people waited for their lenders to take action.

"Bankruptcy is often considered a last resort when it comes to tackling debt problems, but it can actually be the best option for a lot of people.

"That said, anyone facing unmanageable debts should consider all their options. For example, homeowners might benefit from an IVA [Individual Voluntary Arrangement], which can help them to clear their debts without risking losing their home."

Notes to Editors

Think Money is one of the UK's leading providers of financial solutions, and employs around 800 employees to deliver a range of debt solutions, including IVAs, as well as loan, insurance and banking solutions.

For more information, contact Melanie.Taylor@thinkmoney.com (0845 056 6480) or visit the Think Money website at http://www.thinkmoney.com/.

Think Money homepage: http://www.thinkmoney.com/

Think Money IVA: http://www.thinkmoney.com/debt/IVA/

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