Contact: John Hartgen
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JUNE CONSUMER BANKRUPTCY FILINGS INCREASE NEARLY 37 PERCENT OVER PREVIOUS YEAR

July 9, 2007, Alexandria, Va.— U.S. consumer bankruptcy filings increased 37.1 percent nationwide in June from the previous year, according to the American Bankruptcy Institute (ABI). Relying on data from the National Bankruptcy Research Center (NBKRC), overall consumer filings totaled 68,559 in June, nearly a 2 percent decrease from the 69,684 filings in May. Chapter 13 filings constituted 38.3 percent of all consumer cases in June, a slight increase over the previous three months.  

'While bankruptcy filings are up more than 30 percent from the same period last year, they are less than half of what they were in 2005,' said Samuel J. Gerdano, ABI Executive Director. 'However, the underlying concerns of high debt loads are still a constant, pointing to rising filings in the future.'

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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 11,500 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.

*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.