National figures improve

Nottingham, UK, 15 December, 2015 – The number of North East towns struggling with insolvencies has more than doubled in the last 12 months.

Of the 25 towns with the highest rates of insolvency, seven are located in the North East of England, compared to only three during the same time last year. The data looks at the third quarter of 2015 - July to September. Chester-le-Street and Kingston upon Hull have seen 13 in every 10,000 households filing for insolvency, while Washington, Darlington, Durham, Redcar and Hartlepool also prominent on this list.

Torquay continues to top the list as the town with the highest rate of personal insolvencies, with cases recorded in 17 in every 10,000 households, representing a six per cent increase on the same period last year.

Last week, the International Monetary Fund named high household debt among the risks to the UK economy’s growth.

Stratford-upon-Avon in the West Midlands and Durham situated in the North East experienced the biggest rise in terms of insolvencies per household, with both showing an increase of three in 10,000 households from Q3 2014 to Q3 2015. Stratford-upon-Avon increased from seven to 10 in every 10,000 households (a 43 per cent rise), while Durham increased from eight to 11 in every 10,000 households (38 per cent up).

At the other end of the scale, Glenrothes in Fife in central Scotland saw the biggest recovery, with rates decreasing from 13 in every 10,000 households in Q3 2014 to three in every 10,000 households in Q3 2015. Scarborough in North Yorkshire also showed a vast improvement year-on-year, with figures falling from 19 in every 10,000 households in to 10 in every 10,000 households.

Jonathan Westley, Managing Director of Experian’s UK&I Consumer Information Services, said: “It’s encouraging that overall personal insolvency levels are falling and people are managing their household budgets effectively. However, the figures for some northern and coastal areas show there are still some households struggling to stay afloat and it’s vital providers have a broad understanding of their customers’ specific needs and characteristics to serve them responsibly.

“People who have experienced insolvency should remember it’s not the end of the road and they can work to build a positive credit history. The sooner people begin the road to recovery, and take back control of their finances, the easier the process will be. It’s vital people seek help if they are struggling, and organisations like Stepchange and the Citizens Advice Bureau are always ready to provide expert advice and support to anyone in need. We continue to work with lenders to give them the insight they need to treat customers fairly while taking account of affordability.”

Challenges for families on modest budgets

Hard-pressed and vulnerable young families continue to find their circumstances difficult, with 16 in every 10,000 households being declared insolvent. However, this group also saw the biggest recovery rate, decreasing from 20 in every 10,000 households in Q3 2014, according to Experian analysis using its Mosaic people classification system.

The data also revealed all 15 Mosaic groups saw a decrease in personal insolvency levels in Q3 2015, compared to the same time last year. Experian’s Mosaic offers an insight into the demographics of the UK population, looking at households, living patterns and the shape of our cities.

There is an improving picture overall in the UK, and the signs leading into 2016 are positive with Q3 personal insolvencies falling from nine in every 10,000 households in 2014, to seven in every 10,000 households in 2015.

-Ends-

 

Notes to editors

Top 25 towns by highest insolvency rate

Town/Territory

Insolvency rate per 10,000 households Q3 2015

Torquay

17

Chester-le-Street

13

Kingston upon Hull

13

Bootle

13

Warrington

12

Newport (Isle of Wight)

12

Stoke-on-Trent - City Centre (Hanley)

12

Barnsley

12

Redditch

12

Dover

11

Northwich

11

Woolwich

11

Washington

11

Darlington

11

Durham

11

Plymouth

11

Scunthorpe

11

Rhyl

11

Lowestoft

11

Redcar

11

Weston-super-Mare

11

Dewsbury

11

Walsall

11

Hartlepool

11

 

Mosaic Group

Description

Insolvency rate per 10,000 households Q3 2015

Family Basics

Family Basics are families with children who have limited budgets and can struggle to make ends meet. Their homes are low cost and are often found in areas with fewer employment options.

17

Suburban Stability

Suburban Stability are typically mature couples or families, some enjoying recent empty-nest status and others with older children still at home. They live in mid-range family homes in traditional suburbs where they have been settled for many years.

4

Modest Traditions

Modest Traditions are older people living in inexpensive homes that they own, often with the mortgage nearly paid off. Both incomes and qualifications are modest, but most enjoy a reasonable standard of living. They are long-settled residents having lived in their neighbourhoods for many years.

9

Urban Cohesion

Urban Cohesion are settled extended families and older people who live in multi-cultural city suburbs. Most have bought their own homes and have been settled in these neighbor hoods for many years, enjoying the sense of community they feel there.

6

Transient Renters

Transient Renters are single people who pay modest rents for low cost homes. Mainly younger people, they are highly transient, often living in a property for only a short length of time before moving on.

13

Rural Reality

Rural Reality are people who live in rural communities and generally own their relatively low cost homes. Their moderate incomes come mostly from employment with local firms or from running their own small business.

6

Domestic Success

Domestic Success are high-earning families who live affluent lifestyles in upmarket homes situated in sought after residential neighbourhoods. Their busy lives revolve around their children and successful careers in higher managerial and professional roles.

3

Aspiring Homemakers

Aspiring Homemakers are younger households who have, often, only recently set up home. They usually own their homes in private suburbs, which they have chosen to fit their budget.

8

Rental Hubs

Rental Hubs contains predominantly young, single people in their 20s and 30s who live in urban locations and rent their homes from private landlords while in the early stages of their careers, or pursuing studies.

6

Municipal Challenge

Municipal Challenge are long-term social renters living in low-value multi-storey flats in urban locations, or small terraces on outlying estates. These are challenged neighbourhoods with limited employment options and correspondingly low household incomes.

11

Vintage Value

Vintage Value are elderly people who mostly live alone, either in social or private housing, often built with the elderly in mind. Levels of independence vary, but with health needs growing and incomes declining, many require an increasing amount of support.

8

Prestige Positions

Prestige Positions are affluent married couples whose successful careers have afforded them financial security and a spacious home in a prestigious and established residential area. While some are mature empty-nesters or elderly retired couples, others are still supporting their teenage or older children.

2

Country Living

Country Living are well-off homeowners who live in the countryside often beyond easy commuting reach of major towns and cities. Some people are landowners or farmers, others run small businesses from home, some are retired and others commute distances to professional jobs.

2

Senior Security

Senior Security are elderly singles and couples who are still living independently in comfortable homes that they own. Property equity gives them a reassuring level of financial security. This group includes people who have remained in family homes after their children have left, and those who have chosen to downsize to live among others of similar ages and lifestyles.

3

City Prosperity

City Prosperity work in high status positions. Commanding substantial salaries they are able to afford expensive urban homes. They live and work predominantly in London, with many found in and around the City or in locations a short commute away. Well-educated, confident and ambitious, this elite group is able to enjoy their wealth and the advantages of living in a world-class capital to the full.

2

 

Here are some steps from Experian that people can take to help them regain control of their finances and get back on track after a period of financial stress:

  1. Consider your options: Bankruptcy is a special legal status which will see some debts written off, but this is not the only option available. Informal agreements called Debt Management Plans (DMPs) or more formal agreements like Debt Relief Orders (DROs) or Individual Voluntary Agreements (IVAs) may be more suitable for those in financial difficulty, so take the time to understand the differences between each.
  1. Seek advice: Organisations such as Citizens Advice and Stepchange have experts who can provide you with guidance and help you find a solution that suits your situation. It is important to remember there is always support if you need it.
  1. Check your credit report: Once you’ve figured out which option to take, check your credit reports with the three main credit reference agencies to ensure the information is correct and reflects your current circumstances. If you find something on your credit report that you don’t agree with, query it with the lender in question or contact the credit reference agency who can query it on your behalf.
  1. Rebuild a positive credit history: While lenders may view your insolvency negatively, there are products with low limits and high interest rates available for people with poor credit ratings. Using a credit card for small purchases such as groceries, and paying what you owe each month will help show lenders you’re making progress and can be trusted to pay back what you owe.
  1. Manage your credit responsibly: As you start to get back on track, making all repayments in full and on time each month will show that you are managing your finances, and your credit rating will improve over time. So be patient and take it step by step.
  1. Choose wisely: As your credit rating begins to improve, don’t be tempted to make a flurry of application. This could make it appear that you’re losing control and make lenders think you’re living outside your means. Try to make no more than one application for credit every three months.

 

For more information please contact:

Contact:

Tom Pavey Smith / Sarah Muir

Lansons
020 7490 8828
thomasps@lansons.com/ sarahm@lansons.com

 

About Experian

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