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April 2006

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This article is in the news archives --- for current news go to the Third Branch News.


Bankruptcy Filings Soar Prior to New Bankruptcy Law

Bankruptcy filings in the federal courts skyrocketed a record 30 percent in calendar year 2005. The increase occurred largely in response to the passage of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA), as many debtors filed petitions before the law’s general effective date of October 17, 2005.

Bankruptcies filed in the 12-month period ending December 31, 2005, totaled 2,078,415, up from the 1,597,462 petitions filed in the 12-month period ending December 31, 2004. This was the largest number of bankruptcy petitions ever filed in any 12-month period in the history of the federal courts. Bankruptcy filings for the three-month period, October 1-December 31, 2005, totaled 667,431, an historic high for any quarter and up 80 percent from the 371,668 filings for the same time period in 2004.