According to a report by the Administrative Office of the U.S. Courts, bankruptcy filings for the 12-month period ending March 31, 2009, increased by 33.3 percent over bankruptcy filings for the same period in 2008. As of March 2009 1,202,503 bankruptcies have been filed nationwide. The vast majority of those bankruptcies were filed by individuals.
The report said:
- Chapter 7 filings rose 46.3 percent to 819,362, compared to the 560,015 Chapter 7 filings in the 12-month period ending March 31, 2008.
- Chapter 13 filings rose 10.9 percent to 370,875, from the 334,551 bankruptcies filed in the 12-month period ending March 31, 2008.
We can expect to see Chapter 7 bankruptcy filings continue to increase despite the BAPCPA bankruptcy reforms passed in 2005 which were designed to make it more difficult for debtors to discharge their debts in bankruptcy. Because of the economy, many debtors are now facing financial situations where they have absolutely no income due to a job loss and no savings because they used all of their previous income to service debt and pay for everyday expenses. Those debtors have no choice but to file Chapter 7 bankruptcy.