Friday 4th January 2008
Bankruptcies are set to rise in the year ahead as the credit crunch takes full effect - which might prompt higher numbers to investigate consolidation loans.
According to the Consumer Credit Counselling Service (CCCS), many people will opt for bankruptcy above an individual voluntary arrangement, despite the supposed "stigma" attached to the former.
James Ketchell, spokesperson for the CCCS, said: "Bankruptcy seems to have a very bad stigma attached to it, and people for that reason do not go through with it.
"However we view it as a solution, another way of sorting out ones financial situation."
Consumers who realise that they are struggling to pay off their current debts, or who simply find their current situation hard to manage due to a high number of creditors, may like to consider a consolidation loan before bankruptcy becomes a viable option.
The news follows recent figures from price comparison uSwitch that suggested UK consumers could save a collective £15 billion by consolidating current debts.
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