Contact: John Hartgen
OCTOBER CONSUMER BANKRUPTCY FILINGS TOP 100,000 FOR
FIRST TIME SINCE LAW CHANGE IN 2005
November 4, 2008, Alexandria, Va.- U.S. consumer bankruptcy
filings increased 40 percent nationwide in October from the same period
a year ago, according to the American Bankruptcy Institute (ABI),
relying on data from the National Bankruptcy Research Center (NBKRC).
The overall October consumer filing total of 106,266 also represented a
20 percent increase from September. Chapter 13 filings constituted 32.6
percent of all consumer cases in October, a slight decrease from
The October consumer filing total also represents the first time that
bankruptcies have topped 100,000 since the Bankruptcy Abuse Prevention
and Consumer Protection Act went into effect in October 2005. The
880,076 consumer filings through the first 10 months of 2008 (Jan. 1 -
Oct. 31) have already eclipsed the filing total of 822,590 for all of
“October's sharp spike in new consumer bankruptcies confirms
the severe financial stress on household budgets caused by high debts,
flat incomes, and declining home values,” said ABI Executive
J. Gerdano. “We expect the 2008 numbers to be the
highest since the new bankruptcy law went into effect in
ABI is the largest multi-disciplinary, nonpartisan organization
dedicated to research and education on matters related to insolvency.
ABI was founded in 1982 to provide Congress and the public with unbiased
analysis of bankruptcy issues. The ABI membership includes more than
11,700 attorneys, accountants, bankers, judges, professors, lenders,
turnaround specialists and other bankruptcy professionals, providing a
forum for the exchange of ideas and information. For additional
information on ABI, visit www.abiworld.org. For
additional conference information, visit http://www.abiworld.org/conferences.html.
NBKRC is an online research center that offers subscribers access to
up-to-date research and statistics on bankruptcy filings. The database
contains complete information dating back to 1995. For more information
on NBKRC, please visit http://www.nbkrc.com.
*Definitions from Bankruptcy Overview: Issues, Law and Policy, by the
American Bankruptcy Institute.
Chapter 7 of the Bankruptcy Code is available to both individual and
business debtors. Its purpose is to achieve a fair distribution to
creditors of the debtor's available non-exempt property. Unsecured
debts not reaffirmed are discharged, providing a fresh financial
Chapter 11 of the Bankruptcy Code is available for both business and
consumer debtors. Its purpose is to rehabilitate a business as a going
concern or reorganize an individual's finances through a court-approved
Chapter 12 of the Bankruptcy Code is designed to give special debt
relief to a family farmer with regular income from farming.
Chapter 13 of the Bankruptcy Code is available for an individual with
regular income whose debts do not exceed specific amounts; it is
typically used to budget some of the debtor's future earnings under a
plan through which unsecured creditors are paid in whole or in part.