The number of Scots who are struggling with personal insolvencies has risen between April and June, new figures reveal.
In the first quarter of this financial year, the number of protected trust deeds and bankruptcies being reported by the Accountant in Bankruptcy was 3,208.
That’s a rise of 11.8% on the same quarter in 2017, and it’s a shocking 26.6% higher than it was in the first quarter of this year.
A protected trust deed is an arrangement that is legally binding and enables someone in debt to make reduced payments to their creditors over four years.
The numbers have risen year-on-year to reach 1,972, a rise of 27.5%.
Bankruptcies in Scotland
However, bankruptcies in Scotland have fallen to 1,238, a drop of 6.5%, compared with the first quarter of last year, though there is a slight rise from the first quarter of this year.
The number of people accessing the debt arrangement scheme, which is run by the Scottish government, has also risen year-on-year by 8.5%. There were 648 debt arrangement scheme applications approved.
Also, around £9.5 million was paid through the scheme in this period, a slight rise on last year’s figure.
A spokesman for the AIB said that the number of people entering insolvency is much lower than it was 10 years ago, though there is a clear upward trend from the beginning of 2015 to today’s figures.
‘Ensure debt solutions are relevant to today’s society’
He added: “Consumer borrowing is now surpassing the level of that seen before the 2008 crash and there is an ambitious programme of reform to ensure debt solutions are relevant to today’s society.”
A spokeswoman for R3, an insolvency and restructuring trade body, said that higher rates for living and minimum wages which were brought in last April, will have helped many to pay for the higher costs of fuel and food.
However, she says that these increases may not be enough for many people with wage growth now being outstripped by inflation.
With the growing numbers of people living in Scotland who are struggling financially, it’s important for those that are that they seek helpful and impartial advice.
Friendly team of debt advisers at Scotland’s Trust Deed
One such outlet is to contact the friendly team of debt advisers at Scotland’s Trust Deed who can offer guidance about the debt arrangement scheme and also a protected trust deed.
In addition, the team can also discuss the merits of bankruptcy, which is better known as sequestration in Scotland, because careful thought needs to be given to bankruptcy before it is undertaken.
While the Scottish trust deed and debt arrangement schemes are similar, there are big differences with the former seeing someone in debt repay what they can afford over a set period of time with the amount that remains at the end of this period being written off as unaffordable.
That’s not quite the same with the Scottish debt arrangement scheme which sees someone paying what they can afford until all of the debt has been paid back.
Information about the debt arrangement scheme or a Scottish trust deed
For more help and information about the debt arrangement scheme or a Scottish trust deed, it’s time to contact the team at Scotland’s Trust Deed.