Over 40s face massive rise in bankruptcies

The over-40´s are facing a massive rise in bankruptcies as falling house prices take their toll on people´s finances.

The number of individuals in that age group going bankrupt has increased by 124% and has risen from 10,800 to 23,800, and is still said to be rising at the end of 2009. The firm which analysed figures said that an increase in second and even third marriages was a major factor and one in five people divorcing in 2008 had a previous marriage ending in divorce, compared to just one in ten in 1980.

By the time people hit 45, many will have established a second or even third family with additional numbers of children and ex-wives or ex-husbands to support financially.This often means that people have to pay off part of the mortgage for their ex-husbands or wives´ homes, and contributing to child care and maintenance costs while paying for a second set of school fees and mortgage payments.

People of the same age group also found that due to major falls in house prices, they had less equity in their homes and/or were unable to remortgage. The property boom saw a lot of people remortgaging their homes to cash in on the rising value in property, but with the crash, many people haven´t got any equity left in their properties, and nothing to rely on if they are made redundant or if their income falls.

The problem can only improve if property prices rise and unemployment falls.