Regions with highest bankruptcy rates revealed

 

A MAN who bought shares in a racehorse and then chose to go bankrupt to avoid telling his wife is among a growing number of Queenslanders throwing in the financial towel.

The comical anecdote comes as more serious figures reveal the Queensland regions with the highest rates of personal bankruptcies.

In the September quarter 1065 personal insolvencies were recorded in Queensland.

The Greater Brisbane regions with the highest numbers of debtors entering personal insolvency were inner Ipswich (65), North Lakes (53) and Browns Plains (50).

In the rest of Queensland Ormeau and Oxenford (83), Toowoomba (81) and Townsville (77) recorded the highest rate.

Darryl Kirk, a partner at Brisbane insolvency specialist Cor Cordis, said the racehorse scenario was one of his more memorable bankruptcy cases.

Mr Kirk said the man had shares in the horse and owed $40,000 in contributions to its owner.

"He had a house worth $2.5m and about $250,000 in the bank," Mr Kirk said.

"He wouldn't pay the contributions because he wouldn't tell his wife that he owned a share in the racehorse.

"He should not have ever been bankrupted but it was his own fault."

Mr Kirk said the bankruptcy was annulled after his wife agreed to release the money to pay his debt on the horse.

Australian Financial Security Authority figures revealed about 61 per cent of personal insolvencies were in capital cities in the September quarter.

Inner Ipswich had the highest number of personal insolvency rates in Queensland.
Inner Ipswich had the highest number of personal insolvency rates in Queensland.

While the racehorse scenario was a light-hearted one, Mr Kirk said there were "all sorts of reasons" people went into bankruptcy.

"I suspect that those numbers are a lot to do with credit card debts," he said of the latest figures.

"It would be probably people who are lodging their own petitions for bankruptcy.

"For people in this day age, filing for bankruptcy is an accessible way of getting out of debt."

Most debts are wiped when a person enters bankruptcy, but future travel, legal options and borrowing may be affected.

Mr Kirk agreed things were "absolutely" tight and tipped they would get worse when low interest rates started to rise.

"People are taking advantage of the low interest-rate environment," he said.

"There's always a proportion of the population that overextends

"When they over extend the bankruptcy provision is there.

"If interest rates go higher people will have a lower amount of discretionary income."

Mr Kirk said it was not surprising regional centres with lower socio-economic areas had a higher level personal insolvencies.

"I would have expected to see higher numbers in those areas," he said.


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