According to recent statistics, people in the UK owed a whopping total of £1.46 Trillion at the end of January 2016. This posed a significant increase from the 2015 statistics completed only a year prior, having declared £1.43 Trillion in debt at the end of January 2015. These statistics state that the average personal debt per adult has risen by £641.25 in the span of only one year. To know more information about IVA, Visit http://deathby1000papercuts.com/debt-solutions/individual-voluntary-arrangement/.
In the same 2016 statistics, it was also found that the average debt per household was £54,080, translating to an average debt per adult to be £28,913, around 111.9% of the average national earning. This figure still holds many potential bankruptcy threats, despite the planned minimum hike.
In an attempt to remedy the current situation, the UK provides citizens with several alternatives to bankruptcy. Rising personal debts have urged several individuals towards the application of options such as Individual Voluntary Arrangements in England and Wales and Trust Deeds in Scotland. These legal agreements pose fewer threats than bankruptcy and provide alternative monthly payment plans for their debts over a period of time, after which all debts will be cleared.
In a further attempt to improve personal debts, the government of the UK has taken action and announced plans of a minimum amount hike for the debt needed to be petitioned into bankruptcy. The new proposed figures declared a raise from £750 to £5000. This is to be done so as to prevent creditors from making people bankrupt for what campaigners refer to as “unreasonably small” debts.
In line with this, there has also been an announced potential widening of eligibility for debt relief orders. These low-cost bankruptcy alternatives serve as ways of having relatively low debts to be written off, provided that the debtor has minimal assets. Currently, only individuals with debts below £15,000 and properties amounting below £300 are considered candidates for DRO.