Social and short-term renters are among those hit by the highest number of personal insolvencies across the country, new research from global information services company Experian shows.
Experian found that social renters living in urban areas saw the biggest deterioration in insolvencies over the past year– up from 8 to 12 per 10,000 households.
Younger families on limited budgets continue to experience the highest rate of insolvencies overall at 16 in every 10,000 households.
Single people privately renting short-term and low cost homes suffered the second highest number of insolvencies – 13 in every 10,000 households.
These figures highlight where the need for responsible lending is greatest, and where Experian is urging credit providers to fully assess affordability in their lending decisions. The patchy nature of economic recovery in certain pockets of the country highlights the importance of credit providers understanding each individual’s circumstances.
The research also found that the cases of personal bankruptcies is also very high among people living in coastal towns.
Half of the towns in the top ten list for the highest insolvency rates are located on the coast and four of these are in South West England.
Jonathan Westley, managing director of Experian’s consumer information services in UK & Ireland commented:
“It’s clear that the economic recovery has still not spread to all areas, as coastal towns in particular are struggling to stay afloat and still have high levels of insolvency. The same can also be said of young families and some people in ‘Generation Rent’, as many young and social renters find it as challenging as ever to make ends meet. It’s these areas where the need for responsible lending is greatest.
“At Experian we are able to offer help in three ways. We support free debt advice through funding, free credit reports and expert training, and we encourage people to think about personal debt and advise on the positive steps people can take to manage and improve their credit scores. Finally, we work with lenders to give them the insight to treat customers fairly while taking account of affordability.”
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