 With Bankruptcy Filings Up 100%, Are we Out of Recession?Published Date: 2010-02-06 15:47:12 WorkOnInternet.com
Before the 2005 act went into effect in 2006, record numbers of debtors filed bankruptcy under the old laws. Once the new law went into effect, filings fell sharply for a time, but have begun a steady climb from 2006 until the present. And with tens of millions of Americans now out of work and facing huge amounts of debt, bankruptcy filings are essentially back to where they were before the reform was created. With the new bankruptcy laws in effect, simple dismissals of debt under Chapter 7 filings were supposed to be decreased. A means test was administered to the requirements to file, and if the debtor did not pass the test, they would be forced into a Chapter 13 bankruptcy if they still wanted relief through the court system. Although the means test may have kept some borrowers from filing Chapter 7, the high unemployment rate has guaranteed that many people just do not have any means to pay their bills. For them, discharging their debt may be the only solution to avoid collection actions by banks or collection agencies. And with no means to pay their bills at all, they are able to pass the court's test and file a Chapter 7. Thus, banks have always wanted to avoid the chances of borrowers filing for Chapter 7 bankruptcy and being able to discharge all of their debts. Even if the debtors do not have any assets or income, the lending institutions would rather be able to sell the debts or sue the borrowers and obtain judgments and garnishments against them. If bankruptcy is an option at all, banks would rather that it be a Chapter 13 repayment plan, rather than a discharge. Without an end in sight for the recession, and with the government paying banks for making bad loans to consumers, bankruptcy filings can be expected to keep increasing. Americans do not have jobs or assets, because they are being forced to subsidize banks which keep making horrible lending decisions and then claiming the nation's finances and assets for themselves as ordinary people can not keep up. To find out more about the foreclosure process in your situation, visit Nick's website, which provides services to borrowers trying to save their homes before time runs out. Foreclosure refinance, deed in lieu, loan modification, and short sale assistance can be found, as well as information on stopping a foreclosure before the sheriff or trustee auction. You can read more about how to prevent foreclosure while there is still time by visiting the site online at the following: http://www.foreclosurefish.net/
The website has been upgraded. You are reading the article via the old version of the site, the url for the article is now at http://www.workoninternet.com/article_archive/30317.html Home | Submit Article| Article Topics | Article Archives | Newsletter | Business Directory | Contact US |
