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The number of people taking out Individual Voluntary Arrangements [IVAs] to resolve debt problems reached a record high in the second quarter of the year, according to the government’s official insolvency statistics released today.

The figures from the Insolvency Service show that 14,571 people entered an IVA during the quarter – up by 20.3 per cent on the same period a year ago. Although the number of bankruptcies and Debt Relief Orders was down on last year, the total number of personal insolvencies rose to 27,029 – a rise of 5.1 per cent on the same period in 2013.

Richard Wolff, North West chair of the insolvency trade body R3 and Head of Corporate Recovery and Insolvency at JMW Solicitors in MediaCity, said: “Personal insolvencies fell sharply immediately after the recession but the dip has really bottomed out over the last year or so. Over the past year or two, personal insolvency numbers have pretty much held steady, but things are really beginning to creep up, especially with Individual Voluntary Arrangements.

“Individual Voluntary Arrangements [IVAs] are now at a record high. IVAs have become much easier to access recently. Our members have seen IVAs set up for as low value debts as a few thousand pounds and with surplus incomes* well under £200. These IVAs wouldn’t have been considered a few years ago and people might have used debt management plans or informal arrangements instead.

“The first half of the year can be a busy time for insolvencies thanks to a combination of people putting off dealing with problems until after Christmas and the post-Christmas bills landing on the doormat in January, February, or March.”

*Surplus monthly income available to make IVA contributions after payment of living expenses.