Bankruptcy Filings: Downward Trend Continues
CardWeb.com reports that consumer bankruptcy filings in January and February (total of about 203,000) were 17% less that filings during the first two months of 2004 (about 239,000), and 4% below 2003. CardWeb notes that this occurs “ironically at a time when bankruptcy reform will likely be on the President’s desk later this month.”
Indeed.
The March 2005 figures, when they are released in early May, will be the last “clean” numbers before what many believe will be a rush to file to beat the bill’s effective date (I would not be surprised if the expected rush does NOT materialize).
A look at prior-year first quarter filings (in thousands) reveals that this year’s first-quarter filings will almost certainly be the lowest in FIVE YEARS (possibly nine):
- 2005 (two months): 203
- 2004 403
- 2003 410
- 2002 376
- 2001 364
- 2000 302
- 1999 322
- 1998 342
- 1997 321
- 1996 253
Remember, all other things being equal, the lower the level of filings going into when the bill takes effect (six months after the president signs), the lower the amount of additional collections lenders will achieve from the new law, and the more the whole bankruptcy “reform” process will turn out to have been a colossal waste of time, money, and effort, all of which is being borne by the taxpayers (naturally, none by the creditors).
