The Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) was passed in 2005 and requires that an annual report be submitted to Congress containing certain bankruptcy statistics. Bankruptcy can be a daunting process, but these statistics and an experienced bankruptcy attorney can answer your questions and help determine the best course of action in your case.
Total Bankruptcy Filings
In 2010, there were more than 1.5 million bankruptcy petitions filed. These petitions were filed by individuals with mostly nonbusiness debt, known as consumer bankruptcy cases.
Chapter 7 vs. Chapter 13
In Chapter 7 bankruptcy, the debtor’s assets are liquidated and all of the nonexempt proceeds from the liquidation are paid to creditors. Chapter 13 allows an individual with regular income to adjust their debts and follow a court-approved repayment plan. In 2010, approximately 71 percent of bankruptcy cases were filed under Chapter 7 while 28 percent were filed under Chapter 13. The remaining one percent of cases were filed under Chapter 11, which is an option for businesses and individuals who want to continue operating while reorganizing their debts.
Average Income and Debt
Debtors in 2010 reported a median average monthly income of $2,800. Monthly expenses were reported at $2,872.
Time Spent in Bankruptcy
A typical Chapter 13 case takes three to five years to close. The average Chapter 7 case in 2010 took 178 days to resolve, from the date of filing to disposition. The marked difference in the time it takes to close a case is based on the repayment structure of Chapter 7 and Chapter 13.
Multiple Bankruptcy Filings
In 2010, 26 percent of debtors in Chapter 13 cases reported that they had previously filed for bankruptcy in the previous eight years.
Are you considering filing for bankruptcy? A bankruptcy attorney is a useful asset in protecting your rights and interests. At Cutler & Associates, Ltd., we help residents in the Schaumburg and Aurora areas get through their bankruptcy cases.