ABI Endowment to Fund Study to See Whether BAPCPA Has Substantially Increased Consumer Bankruptcy Filing Costs

ABI Endowment to Fund Study to See Whether BAPCPA Has Substantially Increased Consumer Bankruptcy Filing Costs

Contact: John Hartgen
              (703) 739-0800
[email protected]



May 29, 2009, Alexandria, Va. — The American Bankruptcy Institute Endowment Fund has awarded an initial $82,500 grant to Professor Lois R. Lupica, the Maine Law Foundation Professor at the University of Maine School of Law, to examine whether the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA) has substantially increased the costs of accessing the bankruptcy system for consumer debtors and their creditors. Many experts and advocates have expressed concern that BAPCPA has significantly raised costs for consumer debtors and their creditors since its enactment in October 2005 because of the additional fees and conditions that must be met for a consumer to file and receive a discharge from bankruptcy.

BAPCPA mandated that consumers looking to file for bankruptcy must first enroll in credit counseling from an approved counselor 180 days prior to filing. Once the credit counseling requirement is met, consumers must pay a filing fee of $299 for a chapter 7 case and $274 for a chapter 13 case, in addition to any lawyer’s fees. Some courts also impose an additional administrative fee. Once a debtor has filed for bankruptcy, he or she must also pay for a financial-management course prior to receiving a discharge. The court may waive the filing fee in a chapter 7 case if a debtor’s income is below specified levels and the court finds that the debtor cannot pay the filing fee in installments. As job-loss numbers and consumer bankruptcy filings continue to increase in the current economic downturn, BAPCPA’s opponents are continuing to raise arguments that the 2005 bankruptcy law changes made consumer bankruptcy more expensive, more time-intensive and less effective for the consumers who use it.

Prof. Lupica, a former ABI Resident Scholar, will conduct a pilot study of select districts to see whether data from consumer bankruptcy case files show that BAPCPA made the costs of consumer bankruptcy substantially more expensive. Data will be collected with respect to distributions to creditor classes, trustee fees, debtor’s counsel fees and other costs and expenses (such as credit counseling, filing fee and post-filing financial management), and will take into account local rules and orders of the sample districts. The results of the pilot study will be released at ABI’s 2009 Winter Leadership Conference, Dec. 3-5 in La Quinta, Calif. Prof. Lupica will then engage in a full-scale national study on consumer bankruptcy expenses in early 2010, with a targeted completion date of Winter 2011.

The ABI Endowment Fund was created in 1989 to provide a secure financial base for the Institute and to provide resources for insolvency research and education. Projects eligible for Endowment funding include research by individuals or entities relating to bankruptcy or insolvency; surveys or other analytical investigation; the education of judges, court personnel, other governmental personnel and the general public; scholarships or other educational grants; support for the Robert M. Zinman Resident Scholar; and support for both the Chief Judge Conrad B. Duberstein National Bankruptcy Memorial Moot Court Competition and ABI’s Corporate Restructuring Competition. Since 1998, the Fund has awarded over $900,000 in grants and scholarships.


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 nearly 12,000 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 www.abiworld.org. For additional conference information, visit http://www.abiworld.org/conferences.html.