Slight Shift In Insolvencies and Bad Loan Debts May 8th, 2012
Although many individuals across the UK are still facing financial difficulty with their personal loans, credit cards and other debts, there was a slight drop in the number of people entering into an insolvency agreement over the course of the first three months of this year.
The news comes from the credit reference agency Experian, who say that their latest figures show that there were 4.7 per cent fewer insolvencies through bad loan debts in the UK during the first three months of the year, compared with the same period twelve months earlier.
The best improvement in the figures was amongst young professional people and those who have bought a house recently. However, there was an increase in bad loan debs and insolvencies amongst wealthier individual and retired people with a reasonable pension income, where bad loan debs and insolvencies increased by 25 per cent, compared with the same period last year, although these groups only accounted for 2.70 per cent and 3.35 per cent respectively of bad loan debts overall.
The largest group for insolvencies and bad loan debts is still those individuals who are dependent on state benefits, with many ex council house tenants who previously took a loan out to buy their council house, now facing insolvency proceedings through their bad loan debts.
This sector accounts for around 9.26 per cent of the overall population, however insolvencies and bad loan debts in the same sector account for 14.6 per cent of the national total and has seen an increase of 23 per cent this year, above the same time twelve months ago.
Simon Waller of Experian said “By using data and analytics to identify the specific needs and characteristics of customers, lenders can better identify those that are genuinely struggling with their household bills and loan and credit commitments so they can treat them sensitively and according to their individual circumstances.”