Bankruptcy filings in the united states are maintaining a smooth increase. After the subprime lending crisis and its related fallout, the rate has been rising progressively. For the year previous, most indicators were down. This can be ascribed in part to Congress making a sweeping new law back in 2005 which has helped to stop the flow of filings somewhat. Lets take another look at some more information on bankruptcy filings here in this article.
During June of 2007 there were 210,449 bankruptcy filings in the usa, compared to 155,833 one year prior. During one month in 2005 there were an astounding 667,431 filings. That’s over three times the amount of June, 2007. During a twelve month period ending in June of 2008 there were 967,831 bankruptcy cases filed, according to statistics released by the administrative Office of the U.S. Courts. That is a 28.9 percent increase from the year before. Some credit the 2005 number on the system itself of not having any safeguards against fraud, but it’d be tough to pin down a specific reason for the variations of the past compared to today. Today, it is well known that the economy is slowing down, and the results are that folks are having trouble to pay their bills. As a consequence more are looking for bankruptcy protection in an attempt to keep their stuff.
The Congressional Budget Office has stated that some of the differences in rates of bankruptcy protection filings have to do with the states themselves and their own economies. This would make sense from a subjective point of view, but not overall. Since the bankruptcy code has only been changed twice in about 100 years, this latest change, called the ” Bankruptcy Abuse Prevention and patron Protection Act “should help to prevent those that would abuse the system from doing so, regardless of what state they belong to.
There are basic reasons for somebody to file for bankruptcy protection. Medical reasons, unemployment, and what are called transfer programs, such as unemployment insurance and aid to families with dependent children ( AFDC ) are some basic reasons. A study showed the relation of a drop off in the average weekly benefits of unemployment insurance or AFDC led to an increased rate of bankruptcy filings.
Bankruptcy filing using the Chapter 7 program fell somewhat during 2006 after the federal government made it less appealing to do so. These folk were inspired to file under the Chapter 13 program. Total bankruptcy filings in calendar year 2005 were 1,637,254. The same total for 2006 was 1,484,570.
Due to the current economic conditions and the high amount of credit made available, bankruptcy filings in the U.S. are looking to reach record levels.. The banking situation, combined with a particularly weak dollar will be a challenge to all the citizens of the United States.. As an example of such a weak economy, 2008 is the 1st year that the living standards in the UK will again be superior to the U. S. since the nineteenth century.