Default Claims in Iceland Pile up Skip to content

Default Claims in Iceland Pile up

By Iceland Review

According to information from Creditinfo Iceland, 5,938 companies and 17,541 individuals were in default on January 1. The number of individuals in default usually reflects the number of households unable to cover their down payments.

“In most cases these are households with children and usually only one of the two adults in the home is in default, which means that the household is in default,” managing director of Creditinfo Iceland, Rakel Sveinsdóttir, told Fréttabladid.

“We see many people on the default registry who have never been in default before and the claims that these people have to deal with increase very quickly,” Sveinsdóttir added. “There is reason to worry that this group is growing too quickly and will not be able to get back on its feet because the default claims pile up.”

According to Sveinsdóttir, default claims had increased slowly but surely for a year before the collapse of the Icelandic economy in October. After that the speed of new defaults being registered increased fivefold.

The Central Bank of Iceland has requested data from the Icelandic banks on the debts of individuals and companies to examine the effect the crisis has on the real economy.

Click here to read more about the estimated number of companies that are on the brink of bankruptcy in Iceland.

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