Bankruptcy Filings Highest Since Bankruptcy Reform Went Into Effect

According to Credit Slips, a blog dedicated to credit and bankruptcy, bankruptcy filings in the U.S. are now at their highest daily rate since the 2005 changes to the federal bankruptcy law. There were 79,198 bankruptcy filings in February 2008, or 3,959 new filings per day. That is an increase of 28% over the same time period one year before. Further, that represents an increase of 18% over January 2008. Of special interest is the overall trend or rise in bankruptcy filings since BAPCPA took effect in 2005. Credit Slips previously predicted that more than one million bankruptcies will be filed in 2008. If this trend continues this might actually come to pass. It also indicates that consumers are hurting financially.

There are regional variations in these numbers. The state with the biggest increase for the first two months of 2008 is California. Florida and Nevada also appear in the top 10, and all three of these states are consistent with the story that the foreclosure crisis is pushing people into bankruptcy. Virginia, Maryland, Delaware and the District of Columbia also appear in the top 10, suggesting a regional problem. Connecticut, Rhode Island, and Kentucky are the other states with in the top 10.