FORCED INTO BANKRUPTCY

THE number of people being forced into bankruptcy is on the rise.

New figures from The Insolvency Service reveal that 17,459 people in England and Wales were declared bankrupt by a court in 2018.

That works out as 48 people ordered into bankruptcy every day last year, on average.

The number has been on the rise in recent years.

It is up from 15,107 people declared bankrupt the year before and is at its highest since 2014.

The figures only include court-ordered bankruptcies.

This happens when creditors who are owed at least £5,000 apply to a court to make a person bankrupt.

When this happens a person will have their bank accounts frozen and all assets - such as their home - sold.

Money made from the sales is then distributed to creditors.

People are usually discharged from their debts after around a year of bankruptcy.

This means they don’t legally have to repay the cost of their debts.

Anyone who has been made bankrupt, however, will have this noted on their credit file for six years.

The figures reveal that men dominated the bankruptcy orders - accounting for 10,822 court orders.

There were 6,553 women ordered into bankruptcy and 1,088 people whose gender was not recorded.

The North East and South West of England had the highest rate of courtordered bankruptcies (4.5 for every 10,000 people) while London had the lowest (2.7 in every 10,000).

In Wales, 3.7 in every 10,000 people were court-ordered bankruptcy in 2018.

The figures reveal that, along with gender, age has a part to play in the number of people made bankrupt.

People aged between 35 and 44 were the most likely to be court-ordered into bankruptcy (4,860), followed by those aged between 45 and 54 (4,860).

Alarmingly there were 371 people aged between 18 and 24 also made bankrupt by courts last year, as well as 1,046 pensioners.

Peter Tutton, head of policy at the debt charity StepChange, said: “This increase in bankruptcy reflects the very high number of people struggling with financial difficulties.

“In 2018 StepChange Debt Charity was contacted by someone every 48 seconds, and our latest research shows over 3 million people facing severe debt problems. “Insolvency solutions such as bankruptcy can be a good option, but it’s vital that people take advice from a free and reputable debt charity.”

into The North East had the highest proportion of young people ordered into bankruptcy