The BLT recently reported on a document released from the Administrative Office of the U.S. courts showing that new filings in U.S. bankruptcy courts rose 8 percent from 2009-2010. Utah lawyers took a closer look at what that meant for the state. As part of the 10th circuit court, Utah saw a 24% increase in bankruptcy filings in 2010 over 2009; this number is nearly double that of any other state in the circuit. Utah had the fourth highest increase in the country, leading Utah lawyers to further analyze the data.
The national average of 8% pales in comparison to the 30 percent increases that attorneys in Utah have seen across the country since 2006. Nationally, there were 1.59 million new filings in 2010, up from 1.47 million in 2009. This number is significant, and where 71% of those were filed under Chapter 7 of the Bankruptcy Code, Utah lawyers believe that consumers continue to bear the brunt of the financial burden.
The Chapter 7 Bankruptcy Code allows individuals to liquidate assets and gives the court the power to allocate nonexempt proceeds to creditors. While Utah (a member of the 10th Circuit) saw a year to year increase in bankruptcies, the 10th Circuit as a whole (consisting of other mountain west states) collectively experienced an 11.5% increase in bankruptcies.
The 9th Circuit courts experienced the largest jump, from 339,005 new filings to 404,289, about a 19% increase. The 9th circuit is the largest and covers courts in Arkansas, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, Washington, Guam and the Northern Mariana Islands. New filings went up by 56 percent in that circuit between 2008 and 2009, leaving attorney’s in Utah optimistic about the overall decrease in the slope.
While the 8% year to year increase is disheartening news for American’s, attorneys in Utah are encouraged by the marked decreased in the long time bankruptcy trend. While bankruptcy is the best option for many consumers who are overwhelmed with debt, consulting with an attorney can often unveil opportunities that may help consumers to avoid bankruptcy. If you are one of the many Utahans who have filed for bankruptcy, and are concerned with out to repair your credit, read our post about credit repair.
The attorney’s at Shumway Van & Hansen are skilled and knowledgeable in bankruptcy law, with experience representing consumers and creditors. If you are contemplating bankruptcy and would like to seek the advice of attorneys in Utah, please contact Shumway Van & Hansen by calling (801-216-8885) or visiting our website, www.shumwayvan.com.