Consumer Bankruptcy Filings in First Half of 2008 Up 30 Percent from a Year Ago
Contact: John Hartgen
CONSUMER BANKRUPTCY FILINGS IN FIRST HALF OF 2008 UP 30 PERCENT FROM A YEAR AGO
July 2, 2008, Alexandria, Va.— U.S. consumer bankruptcy filings increased 30 percent nationwide during the first six months of 2008 (Jan. 1-June 30) from the same period a year ago, according to the American Bankruptcy Institute (ABI), relying on data from the National Bankruptcy Research Center (NBKRC). The overall June consumer filing total of 82,770 was 20.7 percent more than the 68,559 consumer filings recorded in June 2007. While the June total represented an increase over the previous year, it was a 9.3 percent decrease from the May 2008 total of 91,214 consumer filings. Chapter 13 filings constituted 32.6 percent of all consumer cases in June, a slight increase from May.
“The overall trend of rising bankruptcies reflects the growing financial strain of felt by U.S. households, burdened by high debt, rising mortgage costs and falling home values,” said ABI Executive Director Samuel J. Gerdano.
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
11,700 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.
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 <http://www.nbkrc.com/> .
*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.
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.
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.