MORE people in Huddersfield have declared themselves bankrupt, a report has revealed.
Figures from accountancy firm KPMG showed there were 43 such cases in the town during the fourth quarter of last year – 13% up on the 38 cases logged in the third quarter.
Huddersfield bucked the regional and national trend. The report showed there were 1,130 cases across Yorkshire, which was 8% down on the 1,232 cases dealt with in the third quarter.
Elsewhere in Yorkshire, debtor bankruptcies rose by 39% in Harrogate, but fell by 32% in Leeds.
Across England and Wales, there was a 9% fall to 11,981 in the number of people making themselves bankrupt during the fourth quarter.
There was also a drop in the use of Individual Voluntary Arrangements – where a debtor and creditors agree to restructure the debt, typically to allow the debtor to make regular affordable monthly payments for a fixed period, after which the balance of the debts is written off.
The number of IVAs fell by 12% in the final quarter of 2007, making a total fall of 27% for the year. Some 9,376 people agreed an IVA in three months to December.
Paul Bateman, head of personal insolvency for KPMG in the north, said IVAs had been criticised following concerns about whether they were always the most appropriate course of action for the individual.
Research from KPMG showed that 14% of IVAs proposed by people in financial distress were rejected.
Mr Bateman said: “The broader picture is that although the number of people choosing to go insolvent has dropped, almost every economic indicator suggests that things are going to get worse before they get better.
“Even with interest rates starting to fall, 1.4m homeowners face the end of cheap fixed rate deals this year and the Financial Services Authority has identified more than 1m borrowers who are ‘most likely to default on loans’ – which is a cause of great concern.
“If people struggling with debt lose their home, they often give up and either go bankrupt or enter into an IVA. The continued pressures from council tax, energy and other household bills threaten to push those already struggling with debt over the edge.”
But he stressed: “While many individuals will have to take formal steps to deal with their over indebtedness in the months and years ahead, numerous others may be able to take advantage of informal arrangements and tighter budgeting to avoid the worst effects.”