Contact: John Hartgen
703-894-5935
CONSUMER BANKRUPTCY FILINGS INCREASE 32 PERCENT IN
2009, MOST SINCE 2005
January 5, 2010, Alexandria, Va.
face='Times New Roman' size='3'>— U.S. consumer
bankruptcies increased 32 percent nationwide in 2009 from the previous
year, according to the American Bankruptcy Institute (ABI) relying on
data from the National Bankruptcy Research Center (NBKRC). The data
showed that the overall consumer filing total for the 2009 calendar year
(Jan. 1 – Dec. 31, 2009) reached 1,407,788 compared to the
1,064,927 total consumer filings recorded during 2008. Annual consumer
filings have increased each year since the Bankruptcy Abuse Prevention
and Consumer Protection Act was enacted in 2005.
“A combination of economic stress, including high debt loads,
rising unemployment and unsustainable mortgage burdens, left many
consumers with little choice but to seek the financial relief of
bankruptcy,” said ABI Executive Director
face='Times New Roman' size='3'>Samuel J. Gerdano. “As
these strains continue for U.S. households, we expect that consumer
filings will rise still higher in 2010.”
NBKRC’s data also showed that the 113,274 consumer filings
recorded in December 2009 represented a 33 percent increase from the
84,926 filings in December 2008. Chapter 13 filings constituted 28
percent of all consumer cases in December, a slight decrease from
November.
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ABI is the largest multi-disciplinary, nonpartisan organization
dedicated to research and education on matters related to insolvency.
ABI was founded in 1982 to provide Congress and the public with unbiased
analysis of bankruptcy issues. The ABI membership includes more than
12,400 attorneys, accountants, bankers, judges, professors, lenders,
turnaround specialists and other bankruptcy professionals, providing a
forum for the exchange of ideas and information. For additional
information on ABI, visit
face='Times New Roman'>www.abiworld.org. For additional
conference information, visit
href='http://www.abiworld.org/conferences.html'>
color='#0000ff'>http://www.abiworld.org/conferences.html.
NBKRC is an online research center that offers subscribers access to
up-to-date research and statistics on bankruptcy filings. The database
contains complete information dating back to 1995. For more information
on NBKRC, please visit http://www.nbkrc.com.
size='3'>*Definitions from Bankruptcy
Overview: Issues, Law and Policy, by the American
Bankruptcy Institute.
Chapter
7 of the Bankruptcy Code is available to
both individual and business debtors. Its purpose is to achieve a fair
distribution to creditors of the debtor’s available non-exempt
property. Unsecured debts not reaffirmed are discharged, providing
a fresh financial start.
size='3'>Chapter 11 of the Bankruptcy
Code is available for both business and consumer debtors. Its purpose is
to rehabilitate a business as a going concern or reorganize an
individual’s finances through a court-approved reorganization
plan.
size='3'>Chapter 12 of the Bankruptcy
Code is designed to give special debt relief to a family farmer with
regular income from farming.
Chapter 13 of the Bankruptcy Code is available for an
individual with regular income whose debts do not exceed specific
amounts; it is typically used to budget some of the debtor’s
future earnings under a plan through which unsecured creditors are paid
in whole or in part.