IVAs have also seen a downturn of 15.1% in the number entrants over the last couple of months. This could indicate a positive move, but it is more likely due to creditors taking a harder stance. To enter in to an IVA 75% of your creditors must agree to the proposed dividend and they are collectively standing together to demand higher returns. It would appear that the days of 25p in the pound are disappearing fast, major banks are demanding higher amounts and others have followed suit.

Why are so many people declaring themselves insolvent? Could this be due to people feeling that insolvency no longer holds such a stigma? After all some people are being discharged from bankruptcy after only 6 months. We suspect it could be due to bad advice. We are now seeing more and more people declaring themselves insolvent owing only a few thousand pounds.

Has the drop in IVAs been due to people declaring themselves bankrupt? Time will surely tell. Interest rates have just risen again so the squeeze will be evident over the next few months.