Bankruptcy Filings Rising Across the Country

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As the impact of last year’s rush to file before the bankruptcy reforms took effect and the consumer confusion over the new law fades, bankruptcy filings have begun a slow but steady climb. As consumers in difficult circumstances once again turn to bankruptcy protection, the Total Bankruptcy website at provides extensive resources to help consumers sort out the process, determine whether Chapter 7 bankruptcy or Chapter 13 bankruptcy is appropriate, and even schedule a free consultation with a bankruptcy attorney.

Immediately after the new bankruptcy law took effect in October of 2005, bankruptcy filings dropped dramatically, but that trend is rapidly reversing itself. The abrupt drop-off in bankruptcy filings might have many causes, but two of the most significant are surely the rush to file that took place immediately before the law change and the misinformation that created the impression among consumers that it would be far more difficult to file for bankruptcy protection after October 17, 2005.

Nearly half a million people filed for bankruptcy in the weeks leading up to the law change. Since that number represented about a third of the average annual filings, that rush surely cut down the number of potential filers in the upcoming months. More importantly, though, many consumers were misled into believing that they were no longer eligible to file.

That’s why Total Bankruptcy’s website at provides detailed information about what the new law does—and doesn’t—require. The website includes side-by-side comparisons of Chapter 7 and Chapter 13 bankruptcy, articles about trends in filing, information about what the changes really mean to consumers, and a detailed explanation of the “means test” that is largely responsible for the misconception that many people are now disqualified from filing for bankruptcy protection under Chapter 7.

Total Bankruptcy also maintains a bankruptcy blog with current posts about bankruptcy developments, cases in the news, and credit issues of interest to people considering or recovering from bankruptcy.

Once a consumer has looked at the statutes, the options, recent decisions in bankruptcy courts, and other relevant information, he can fill out a brief form or make a toll-free phone call to schedule a free consultation with a bankruptcy attorney in his area. During this no-obligation consultation, the bankruptcy attorney will answer questions to help the consumer make good decisions about which type of bankruptcy—if any—he should pursue.

As the impact of the huge number of filings in the fall of 2005 dissipates and the public becomes aware that only a tiny fraction of intended bankruptcy petitioners are actually affected by the credit counseling and means testing requirements, the number of petitions filed is growing each month, with many states reporting three times as many filings—or more—in March as they saw in January. If this trend continues, the new statutes may turn out to have had little effect beyond making the process more complicated for consumers and their attorneys.


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Tiffany Sanders
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