Amidst the good news of home sales increasing , we see some discouraging news of the financial health of the American consumer and business.
The government reported that Bankruptcy filings surged 29% in the 12 months that ended June 30.
Business filings jumped more than 41% 
This jump in bankruptcy was for all Bankruptcy types, 7 , 11 and 13.
More surprising, is the large jump in numbers since the strict limitations imposed by the 2005 Bankruptcy Abuse Prevention and Consumer Protection.
Please note the following political positions on bankruptcy law and reform
- Sen. John McCain, R-Ariz., supports the current more strict legislation.
- Sen. Barack Obama, D-Ill has proposed to fast-track bankruptcy proceedings for military families and help seniors facing bankruptcy keep their home
I am not a proponent of consumers taking advantage of bankruptcy if the can repay the debt.
However, in light of the fallout from the real estate crisis and sub-prime debacle, we are facing unique times and many consumers do not need to be drowning in debt they cannot repay.
After all, America and its people are a country of second chances.
Greta post James interesting numbers.
Kacem Benali Bethesda Realtor. Bethesda Homes for Sale
I see a huge surge in BK filings. I think that if there is an ability to repay, then something needs to be worked out barring the death of an income earner or something of extraordinary circumstances.
Kacem , Larry - I just hope that any potential law revisions or changes does not prevent those who truly are in finacial hardship from being allowed the possibilty of a second chance
James,
Great information to share and some things not good to see, but that happens these days. I hope that it will not affect more people in the near future.
Ray Saenz
I am all for second chances. just worried about abuse of the system by those who can afford a good bk attorney
BK allows people to clear their debt. They then can build credit. Ultimately, this allows them to contribute to the economy buy homeownership. - just hopefully, not overspending this time
bankruptcy is not supposed to be a free -pass. Like many governement programs, they are designed to help the truly unfortunate. - If we do this, we are a country of prosper and sharing.
james- these are times that cause for exception. Many are buried in mortgage debt that they cannot afford to pay. ; not choose not to pay. They need to be allowed a fresh start.
I think you hit the nail on the head. There is a huge difference between filing BK to simply avoid debt that you could reasonable repay and filing to avoid losing everything. I absolutely abhor all the bashing of people who may be facing the harsh reality of this stagnant economy. Today it might be them, and tomorrow you might be them. Great post!