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Individual insolvencies in England and Wales are at an all time low for over eight years. This is according to the latest government report.

It is said that 101,049 people were declared bankrupt last year. This is the lowest rate since 2005.

A reason to why the rate is falling is said to be due to people finding it harder to get credit due to lenders not willing to risk on individuals with lower credit ratings.

However this can all change, the Bank of England is expected to raise its interest rate for the first time since 2009 due to the strengthening of the economy. People will find it hard to repay mortgages due to the hike in interest and this can lead to further difficulty for people who are already stretched financially. So forecasters are expecting insolvency to rise in the near future.

An insolvency partner at HW Fisher said: “These are the best insolvency figures we’ve seen in a while” “But with many of Britain’s businesses still just ‘hanging on’, thousands of our weaker firms are far from out of the woods yet.”

“Sooner or later, interest rates will rise and bank forbearance will end – and when that happens the weaker firms will be in serious trouble,” he added.

Update June 2016:

According to figures released in May this year by the Money Charity, UK personal debt statistics now topped £1.474 TRILLION at the end of March 2016. This rose from £1.434 TRILLION at the end of March 2015, which means an extra average debt of £793.13 per UK adult according to current population figures.

The average borrowing per household, including mortgage loans, was calculated to be £54,597 in March, making the average debt per adult £29,190,which is around 111.9 percent of UK average earnings.

Consumer credit levels still outstanding was shown to be £182.4 billion at the end of March 2016, up from £171.1 billion at the end of March 2015. This works out at an increase of £198.45 for every adult in UK, making average consumer credit borrowing per UK adult £3,613.

Credit card debt in January 2016 accounted for £63.3 billion, an average of £2,381 debt per household held on ‘plastic’. Not good news for for many people with credit card debt who can only afford to pay the minimum rate each month. With average credit card interest rate at current levels, it would take 25 years and 6 months to repay by only making minimum repayments each month.

The number of personal insolvencies declared now stands at an average of  222 people a day.  This is equal to one person going bankrupt every 6 minutes and 13 seconds.

You can see the full breakdown of these and other figures on the Money Charity site here.