Submitted by Jen Jones on Wed, 01/05/2011 - 11:56am
Just as many people head back to work after an extended holiday, and many more continue to look for work in the New Year, new data this week shows that the old year (2010) was marked by more consumer bankruptcies that any other since stricter federal bankruptcy laws were enacted in 2005. What’s more, this five-year high in the number of U.S. consumers seeking bankruptcy protections could rise even higher as other Americans continue to drown in debts accumulated during the economic meltdown.
From an article by Jonathan Stempel of Reuters we know that “Roughly 1.53 million consumer bankruptcy petitions were filed in 2010, up 9 percent from 1.41 million in 2009, according to the American Bankruptcy Institute, citing data from the National Bankruptcy Research Center. Filings in December totaled 118,146, up 4 percent from a year earlier and 3 percent from November's total.”
What’s most surprising is that this onslaught of personal bankruptcy filings comes even as men and women all across the country desperately try to cut spending and debts in the wake of near double-digit unemployment and lingering job insecurity. Nonetheless, experts believe that despite decreases nationally in consumer debts (normally a disincentive for bankruptcy filings) the weak economy is still impacting lenders willingness to provide loans, loan modifications, or credit when borrowers actually do need a cash infusion, causing many millions of households to seek the safe havens a bankruptcy can provide in order to continue saving for the things they need most.
“There were 2.94 million U.S. consumer bankruptcy filings in 2009 and 2010, the most over a two calendar year period since the 3.6 million recorded in 2004 and 2005. ‘The (2005) law was supposed to reduce filings, but we are very close to levels we were at then," said Samuel Gerdano, executive director of the American Bankruptcy Institute. ‘The laws of economic gravity are more powerful than the laws passed by Congress.’"
Despite the recent drop in consumer spending, undoubtedly the “economic gravity” of the country’s current financial plight makes it a heavy time for many Americans and, if you’re here and reading, probably for you too. Well, understand that things are predicted to be heavy for a while, as the worst of 2010 is hardly behind us, with high unemployment, an ongoing foreclosure crisis and megabanks, whose dubious practices forced millions from their homes last year, managing to spread more financial uncertainty into 2011. And given there’s usually a 12- to 18-month lag between declines in consumer spending and bankruptcy levels, most insolvent individuals will likely find few options that beat bankruptcy’s debt dissolution strategies throughout the New Year and possibly beyond.
Is the housing market, job market, or a combination of factors hitting you and your household hard? If so, the bankruptcy figures above show you’re not alone. But, there’s strength in these numbers—numbers that reveal the real benefits of discharging debts under a Chapter 7 liquidation or Chapter 13 restructuring bankruptcy. Once taboo, these types of filings are becoming commonplace measures for millions of men and women hoping to restructure their debts into a more affordable payment option or, in most cases, dispense with them completely.
Regardless of the bankruptcy you need, a qualified bankruptcy attorney is what you’ll want during the bankruptcy process to work in your best interests. The bankruptcy experts at the Law Offices of John T. Orcutt offer a totally FREE debt consultation. Just call toll free to +1-919-646-2654, or make your own appointment online at www.billsbills.com. Simply click on the yellow “FREE Consultation Now” button TODAY for a better 2011 and beyond.
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