It is claimed that ten thousand people will go bust in the first 3 months of this year as a result of over spending at Christmas.
REVIVAL expects some 28,000 individuals to either go bankrupt or enter Individual Voluntary Arrangements to repay their debts by the end of march this year.
Sarah Walford at revivalforyou.co.uk says “ the Bank of England’s decision to cut the base rate in December to 5.5% will offer little relief”.
“Many individuals over spend on credit at Christmas without giving a thought to how the debt will be repaid once the bills start to arrive. In January, they find themselves in a situation where previous financial worries are worsened by the bills arriving from the Christmas season, and in these situations, insolvency becomes the only way out.”
The situation will only worsen for some as 1.4 million households will come off cheap fixed rate mortgages in the next 12 months, adding as much as £140 a month to their mortgage bills.
4 Jan 2008