Personal Bankruptcy Filings Still Rising

According to the American Bankruptcy Institute (ABI) and the National Bankruptcy Research Center, the number of consumer bankruptcies filed has topped one million for the first three quarters of 2009, the highest numbers since the overhaul of the bankruptcy system in 2005. The ABI, an organization comprised of attorneys, accountants and other bankruptcy professionals, showed personal bankruptcy filings at 1,046,449 as of September 3, 2009. According to the institute’s data, this number is in comparison to 773,810 personal bankruptcy filings for the same period a year ago. September 2009 filings were 41% higher than those of September 2008, at 124,790.

The entire U.S. bankruptcy system was revamped four years ago to make it more difficult for people to discharge their debts by filing for personal bankruptcy. In that year, before the new laws took effect, 1.35 million Americans filed for bankruptcy during the first nine months.

However, this brutal economy has sent bankruptcy filings soaring again; the ABI expects personal bankruptcies to surpass 1.4 million by the end of 2009. "Bankruptcy filings continue to climb as consumers look to shelter themselves from the effects of rising unemployment rates and housing debt," the institute's Executive Director Samuel J. Gerdano said in a Wall Street Journal article by Sara Murray.

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