Bankruptcy/Debtor-Creditor Rights Blog

AS EXPECTED, BANKRUPTCY FILINGS INCREASED SIGNIFICANTLY IN 2009

Posted January 25, 2010

Author: Alex T. Gray

The number of bankruptcy filings, a statistic often used as a barometer of the economy, increased 32% to 1,446,000 in 2009, which were the highest since Congress enacted the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) in 2005.   The BAPCPA does not seem to be achieving one of its main goals, however, which was to force individuals into Chapter 13 instead of Chapter 7:  in 2009, Chapter 7 filings increased by 42% while Chapter 13 filings increased by only 12%.  In December 2009, approximately 116,000 bankruptcy petitions were filed, which, although slightly higher than the 115,500 filed in November, was down significantly from the October total of 130,200.   The volume of bankruptcy filings indicates that although there are other signs of a recovering economy, we are definitely not out of the woods yet.

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