The number of people who have become insolvent has dropped to its lowest level since 2008, despite the tough economic conditions, official figures showed today. The Insolvency Service reported today that there were 28,973 personal insolvencies - bankruptcies, Individual Voluntary Arrangements (IVA) and Debt Relief Orders (DRO) - in last three months of 2011, down by 4 per cent from 30,219 in July, August and September. The total number of personal insolvencies in 2011 was 119,850, a decrease of 11 per cent from 2010.

Within that figure the number of personal bankruptcies fell by 28.3 per cent compared with the same period in 2010. IVAs rose slightly by 4.5 per cent, however DROs were up by 18.3 per cent compared with the same three months 2010. Some experts warn that the figures show that there is 'more trouble to come' and that they hide a growing number of 'zombie' debtors who have struck arrangements with lenders without resorting to formal debt control mechanisms
Frances Coulson, president of the Association of Business Recovery Professionals, said: 'The decrease in personal insolvencies does not necessarily indicate that individuals are better at dealing with their personal finances, rather that we are seeing the emergence of "zombie" debtors....Read more here--: Personal insolvencies at a three year low but experts warn of 'zombie' debtors who fall official figures