Moin, moin!"Bankruptcy Filings Rise, Putting U.S. on Record Pace"

verfasst von marsch, 25.08.2001, 11:25

08/24 17:20
Bankruptcy Filings Rise, Putting U.S. on Record Pace (Update1)
By Bob Gravely

Washington, Aug. 24 (Bloomberg) -- The number of Americans declaring bankruptcy rose almost 25
percent between April and June compared with the same period a year ago, putting 2001 on track
to break a record of 1.4 million bankruptcy filings set in 1998.

``That's just a shocking number,'' said Sam Gerdano, executive director of the American Bankruptcy
Institute, a non- partisan research institution. ``There's never been a first six months like we've had
this year.''

More than 400,000 Americans declared bankruptcy between April and June, a 24.5 percent
increase from the same quarter last year, according the Administrative Office of the U.S. Courts.
Filings increased during the first three months of this year by 18 percent over the first quarter of last
year.

Gerdano's group calculates that the 767,235 new cases during the first six months of this year
surpasses the number of cases during the first half of 1998 by 5.4 percent.

Gerdano attributed the rise to a sluggish U.S. economy and a desire by some consumers to declare
bankruptcy before Congress clears legislation making it harder to discharge credit card debt.

Small Rise in Business Cases

Bankruptcy filings increased 8.6 percent to 1,386,606 during the 12-month period that ended in
June, according to the U.S Court's data, which was released today. Personal filings increased 8.8
percent to 1,349,471 during that period. Business filings increased 0.6 percent to 37,135.

Bankruptcy cases increased steadily from 284,517 in 1984 to 1.4 million in 1998. Filings decreased
slightly in 1999 and 2000.

Analysts say that recent job cuts by U.S. companies such as Ford Motor Co., have made more
Americans unable to pay credit card and other debts. There were 3.18 million Americans collecting
unemployment benefits during the week that ended Aug. 11, the highest number since 1992.

According to the Federal Reserve data, Americans devoted 14.4 percent of disposable personal
income to paying off debt in the first quarter of this year, the highest level in 14 years.

``People have been laid off and had their incomes reduced, and some have been pushed over the
edge,'' said George Yacik, vice president of SMR Research Corp., a New Jersey-based consumer
finance research firm.

Yacik and Gerdano said the bankruptcy legislation pending in Congress is causing some of increase.
The House and Senate have passed bills that differ only at the margins, with a final version
expected later this year.

Tightening Chapter 7

The legislation is a top priority for MBNA Corp. and other credit card issuers and retailers. It would
prevent most debtors with incomes above the state median from filing for bankruptcy under Chapter
7 of the code, which allows bankruptcy filers to escape unsecured debt after liquidating some assets.

Instead, more debtors would be forced into Chapter 13 bankruptcy, in which debtors are forced to
repay debts in part or in full over three to five years.

Consumer groups and other opponents of the bankruptcy bill say that making it harder for Americans
to absolve debts through bankruptcy will prevent many from getting back on their feet after job loss,
illness or other setbacks. The bill's supporters say too many well-to-do debtors abuse the system by
filing under Chapter 7.

During the 12-month period ending in June, there were 972,659 Chapter 7 filings and 403,418
Chapter 13 filings.

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gesamter Thread:

• Moin, moin!"Bankruptcy Filings Rise, Putting U.S. on Record Pace" - marsch, 25.08.2001, 11:25
  • Re:"That´s just a shocking number!" owT - JüKü, 25.08.2001, 13:01
    • Na gut, Du hast zitiert.:-) oT. - BossCube, 25.08.2001, 16:43
      • Fonds im Goldrausch, Link zu WamS-Artikel (owT) - Harry-2, 25.08.2001, 20:28