MA Bankruptcy Filings: Have we finally reached the peak?

January 24, 2010

MA Bankruptcy Filings: Have we finally reached the peak?
Email[Edit] | Written by karalawyer on Jan-24-10 2:00pm
From: quincylegal.wordpress.com 

by Attorney Kara O’Donnell
O’Donnell Law Offices
http://www.QuincyLegal.com 

According to recent data released by The Warren Group, personal bankruptcy filings in Massachusetts dramatically increased in 2009 and were up a whopping 33% over the numbers for 2008. 

While 2008 resulted in 12,034 filings, the number for 2009 was 16,033 – and this is just the number for Chapter 7 filings! 

See the MA Bankruptcy Filings chart here: ma bankruptcy filings chart  

Chapter 7 bankruptcy (known as the “full discharge” bakruptcy”) remains the most common option for individuals (both in MA and nationwide) and accounted for 81 percent of all filings in the state in 2009. 

While it is common knowledge that a bad economy almost certainly results in increased bankruptcy filings, there existed additional factors to push the expected increase even higher. The combination of unusually high unemployment rates coupled with plummeting home equity sounded the death knell for most “paycheck to paycheck” families. Gone were the days of home equity loans and 401k advances to pay the bills and get by, if not for just one more month. And just when you thought things couldn’t get much worse, credit card rates skyrocketed. Some debtors’ credit card accounts were closed by the credit card companies and some had their credit limits decreased – both bad signs of a credit card company’s financial well-being. 

Creditcards rates up, limits down!

Creditcards rates up, limits down!

 

Just as in the real estate market, it is difficult, if not impossible, to guess just where the upward trend will finally peak. Some experts believe that high numbers of bankruptcy filings follow the point at which the economy is at its worst. Others say that with increased filings more debtors are pulled away from the precipice of total financial collapse. One can only hope that some relief for overburdened debtors is on its way in 2010. 
Kara O’Donnell, Esq.
O’DONNELL LAW OFFICES
Quincy, Massachusetts
http://www.QuincyLegal.com
Help@QuincyLegal.com 

Posted by Kara O’Donnell
Posted in Bankruptcy, bankruptcy massachusetts, Financial, Law, Legal Tagged: Ch. 13, Ch. 7, Chapter 13, Chapter 7, Chapter 7 Bankruptcy 


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