According to a recent National Bankruptcy Research Center report, bankruptcy filings increased by 9% in 2010 (versus 2009). The total number of bankruptcy filings in 2010 was a little over 1.5 million - which comes out to a whopping 1 in 150 Americans. This is the highest number of bankruptcy filings since 2005, when Congress revamped the bankruptcy laws.
The news isn't all bad tough. Although the 2010 numbers are huge, yearly filing increases since 2006 have been closer to 30%. So the 9% increase in 2010 actually represents a slowdown in the growth of filings. Perhaps a very cautious indication that the number of Americans in financial distress may be starting to wane?
It's also interesting to note that the number of Chapter 13 bankruptcy filings represent only 28% of the total. So, despite Congress' 2005 law changes intended to push people into Chapter 13s, it appears that the majority of Americans still prefer, and still qualify for, Chapter 7 bankruptcy (something Steve Elias has been saying all along in his blog posts).
By: Guest Blogger Kathleen Michon