Fewer lenders will be prepared to offer you money, and those that do consider you will charge higher rates. "For a mortgage, you could expect to pay as much as 1 or 2 per cent higher than on a standard loan," says James Cotton at broker London & Country.Additionally, you will have to surrender all your possessions - except basics like clothing - to the court if you seek bankruptcy, and may have to cash in your life insurance policy. Over the past few weeks, lenders including Barclaycard and Royal Bank of Scotland have alerted markets to the worrying trend of bad debts among consumers. And hopes of an interest rate cut have been dampened.Like many, Mr Boyden is concerned that people "mistakenly believe bank-ruptcy is a softer option".To start with, it will cost you £450 simply to file a bankruptcy form, picked up at your local county court and then passed to an Official Receiver.Your credit reference, crucial for a mortgage or bank loan, will be marked for six years after you've been discharged. It has also found that 15 per cent of bankrupts in the 12 months to 31 March 2004 were aged 30 or younger.Patrick Boyden, a partner at PwC, adds that a "new bankrupt" is emerging - "one who is more likely to be female, under 30 and who hasn't been in business".There are growing signs that worse could be to come. Today's bankrupt is more likely to have had no full-time job and run up tens of thousands of pounds on credit cards.Most bankruptcies in the first quarter of this year were down to consumer debt (75 per cent) and to personal circumstances such as redundancy and divorce, according to research from accountants PricewaterhouseCoopers (PwC). This broke the previous record of 36,794 in 1992, during the depths of the last recession.Then, collapsed businesses and redundancies were fuelling the figures.

These allow an individual to be discharged from bankruptcy and walk away from their debts in less than 12 months; it was three years before.Interest rates have also played a part. They have been steady at 4.75 per cent since last August, but there was a swift rise from 3.5 per cent in October 2003.Whatever the main driving force, in the first three months of this year the number of quarterly bank- ruptcies broke through 10,000 (10,091) for the first time - up by 25 per cent on the first quarter of 2004, according to figures from the Government.Last year there were 46,651 bankruptcies or individual voluntary arrange- ments (where you enter a legal agreement to repay your debts). "More of our advisers are suggesting bankruptcy as the way out," says CAB debt specialist Sue Edwards. "We recently had one individual with 31 credit cards owing more than £100,000."Ms Edwards believes that the rising number of debt-ridden individuals is "about a socio-cultural attitude to borrowing and lending; and it's about plenty of competition between lenders too."Others point instead to changes in the law last year. Unfortunately, it's the profile of the average caller to the Consumer Credit Counselling Service (CCCS), the body that helps those struggling to manage their debts. "They typically owe £28,000 to about 11 creditors, including banks, stores and utilities," says Frances Walker of the CCCS."One in four who we see for counselling is [told] bankruptcy is one of their best options," she adds.Last year, it advised 37,530 people; this year, it's on track for over 40,000.It's a similar story at the Citizens Advice Bureau. Hear someone described as in their late 20s, with a wallet full of credit cards, nearly £30,000 to their name and seeking attention, and you might imagine a resum?t a dating agency. It pays 4.89 per cent on its Premier Plus account while offering free individual travel insurance..

"You can already get commission-free currency and cheap travel insur- ance elsewhere," says Sue Hannums at independent financial adviser Chase de Vere.The new launches were announced only a week after the bank cut rates on several of its savings accounts by as much as 0.25 per cent.Meanwhile, not every HSBC current account customer benefits from the price promise: basic account holders (those on low incomes) don't have debit cards and are excluded.Anyone looking to switch their current account could consider Alliance & Leicester, Ms Hannums suggests. The bank still pays painfully low rates of between 0.1 and 0.25 per cent on credit balances up to £10,000, while charging between 9.9 per cent (Premier) and 12.8 per cent (Bank Account Plus) on balances in the red.And all those extra goodies are hardly unique. No other relationship with HSBC is required.Whatever these deals have got going for them, they hardly, as HSBC claims, make "current account history". To qualify, however, customers need substantial sums of money tied up with the bank: either a minimum £75,000 salary and a £100,000 mortgage; a £200,000 home loan; or savings worth £50,000 or more.Otherwise, people who earn at least £75,000 but have no other financial relationship with HSBC must pay £19.95 a month.Meanwhile, its new Bank Account Plus current account is also aimed at frequent travellers and offers similar benefits but at a starting cost of £9.95 a month - rising to £12.95 in January. The minimum you can claim per item is £10 and you can't reclaim more than £5,000 in a year.Other changes at HSBC include a rejigged Premier current account, which offers free worldwide travel insurance, free overseas cashpoint withdrawals (although a loading fee is still levied), commission-free currency and an ID theft helpline. This time HSBC held the musket, with a "price promise" aimed at keeping its 7.6 million current account customers loyal and adding to their numbers. Buy a branded high-street product (not online, though, or in a sale) and find it cheaper elsewhere within 60 days, and the bank will refund the difference.