Yes, bankruptcy is still a major problem for not only Atlanta residents but also the state of Georgia and nationwide. A recent study published that bankruptcy filings in March of 2010 were not only the largest of the year, but also the largest in some time. 150,000 bankruptcies were filed in March of 2010 nationwide.
Why the spike?
A study by the National Bankruptcy Research Center pointed out how bankruptcies did increase between February of 2009 and March of 2009, but not nearly the same level. Traditionally, bankruptcies have spiked in March, but the increase between months in 2010 was over 20 percent, while between the months in 2009 the spike was only 5 percent. So 15 percent more filed between those months this year. The spike then may not be just seasonal. However, with jobs being created more in 2010 than in past years, there may be answers.
Who is filing?
Middle class consumers who have homes, moderate paying jobs, and common medical bills are the main people filing for bankruptcy.
What is the main cause of filing?
There are many different ways to look at this. Historically, job loss and wage deduction was a major reason for filing bankruptcy. Since the mortgage crisis, filing Chapter 13 bankruptcy was much more common. However, other studies have highlighted how medical debt is forcing thousands to file bankruptcy. So it would be safe to say medical, foreclosure, and job loss are the prime culprits.
Where are the answers?
The best news we have, especially in Georgia, is that new jobs are being created nationwide. It may seem odd that jobs are growing as bankruptcies increase, but it may portend to an improving economy. Also, Chapter 7 is still the main form of filing. Abut 75 percent of filings are Chapter 7, while Chapter 13 is only about 25 percent.
When will this slow?
If job creation continues perhaps home owners will be safer. With medical reform on the horizon, medical debt may be a thing of the past for many. While the economy improves, bankruptcies will still be a fact of life but perhaps less so.
How should you file?
You need an experienced bankruptcy attorney to take your case. Because Atlanta specifically has been hit hard by bankruptcies, especially because of subprime mortgages, you need to know your options. If you hire an attorney, he or she can walk you through the process. Chapter 13 bankruptcy is a solution for home owners as it can help you keep your home. Chapter 7 can eliminate the main reasons for filing: credit, medical, and mortgage debt.
