Scottish insolvency numbers continue to grow

Accountants in Scotland believe that individual insolvency numbers and bankruptcy figures in Scotland will hit record highs in 2011 with a forecast 22,000 people made bankrupt or forced to take out protected trust deeds during 2010. This is a massive increase on the previous year and with economic woes set to continue for a few years yet there are major problems ahead for the Scottish financial industry.

Many expect the number of protected trust deeds granted in Scotland to grow significantly in 2011 with a large proportion of the Scottish employment sector dependent upon the public sector. As we have seen in England, there will be massive cost-cutting exercises in the public sector over the next decade which will mean more and more people thrown onto the unemployment list in Scotland. Many people are already struggling to cope with record debt in Scotland and despite the fact that UK interest rates are at an all-time low, more and more people are struggling to pay off their minimum credit card and loan repayments.

One more problem in the future with will be mortgage repayments because even though UK base rates are currently 0.5%, and mortgage rates are relatively low compared to recent times, these rates will increase significantly in due course. Unless the economy is in a significant growth period there is every chance that more and more people will be pushed towards the edge of the financial precipice due to increasing mortgage payments, higher inflation and potentially less money coming into the household.

If you are struggling to cope with debt it is vital that you take professional financial advice with trust deeds and protected trust deeds the equivalent of IVAs in England.

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