Bankruptcy cases rise in 2007
The number of bankruptcy cases in Australia rose by almost 5,000 last year, sharply reversing a decline in the number of insolvents over the past six years.
The statistics and information on Australian debtors was released by the Insolvency and Trustee Service Australia (ITSA) in its biennial Profiles of Debtors publication for 2007.
The number of Australians becoming insolvent dropped from just over 25,000 in 2001 to a low of 21,076 in 2005.
The 2007 profile showed that 62 per cent of bankrupts had an income of less than $30,000 per annum in the year before bankruptcy, while 87 per cent had an income of less than $40,000, proving that the majority of bankrupts come from low socio-economic circumstances.
More than 6,600 people entered into debt agreements as an alternative to bankruptcy. Thirty-one per cent of people entering into debt agreements had a gross income of less than $30,000 per annum. Thirty-five per cent of those who entered debt agreements owed uninsured creditors less than $20,000 and 8 per cent owed less than $10,000.
ITSA attributed the main causes of financial difficulty as excessive use of credit, unemployment and loss of income.
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