AP: 2009 bankruptcies total 1.4 million, up 32%

[Kadie]

AP: 2009 bankruptcies total 1.4 million, up 32%
Posted 35m ago

By Mike Baker, Associated Press Writer

RALEIGH — U.S. consumers and businesses filed for bankruptcy last year at a pace that made 2009 the seventh-worst year on record, with more than 1.4 million petitions submitted, an Associated Press tally showed Monday.
The AP gathered data from the nation's 90 bankruptcy districts and found 1.43 million filings, an increase of 32% from 2008. There were 116,000 recorded bankruptcies in December, up 22% from the same month a year before.

While experts believe some of the increase is due to a natural recovery as consumers and attorneys become accustomed to a recent overhaul of bankruptcy laws, the numbers indicate clear correlations to recession-weary regions. Arizona saw the fastest increase, a jump of 77% from the year before, followed by Wyoming (60%), Nevada (59%) and California (58%).

Emile Harmon, who owns a law firm in Tempe, Arizona, said the firm has doubled its staff to handle the surge in bankruptcy filings. The lawyers have been steadily shifting away from their other areas of business, civil lawsuits and divorce cases.

snip...
"A lot of the people we see were in a really good financial position two years ago," Harmon said. "People really look at you and say, 'I can't believe I'm here."'

For three years, filings have been steadily rising back toward levels reached early in the decade before Congress overhauled the nation's bankruptcy laws. The 2005 alterations made bankruptcy filings more cumbersome, a move that followed fears from lenders that some consumers were abusing the system to wipe away debts.

more...
http://www.usatoday.com/money/economy/2010-01-04-bankruptcy-2009_N.htm?csp=34

[tonysam]

1. So much for bankruptcy "reform." n/t

[Hello_Kitty]

2. That's the thing. Most of them qualify for Chapter 7 now.

These bankruptcies are being driven by unemployment and people are failing the means test.