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Consumer Bankruptcies Continue to Rise in October

The American Bankruptcy Institute (ABI) reports that consumer bankruptcy filings in the U. S. have increased again for the month of October. The information, based on data from the National Bankruptcy Research Center (NBRC), keeps the country on track to reach 1.6 million consumer bankruptcy filings by the end of 2010.

There was a total of 132,173 bankruptcy filings in the nation for the month of October, representing a 1.4 percent increase from the 130,329 consumer bankruptcy filings in September. Still, October's filings are down 2.75 percent from the 135,913 consumer filings from October 2009.

ABI Executive Director Samuel J. Gerdano noted that consumers plagued by unemployment and financial distress are seeking some much-needed relief in bankruptcy protection. He also predicted that the number of consumer bankruptcies for 2010 would reach 1.6 million.

The majority of consumer bankruptcy filings are seeking protection under Chapter 7 bankruptcy, which provides a fresh financial start by discharging unsecured debts.

A Bloomberg News survey predicts that U.S. unemployment most likely remained at 9.6 percent for the third month in a row. The survey used the median of 61 estimates to predict October's unemployment rate. The Labor Department should release the unemployment report for the month on November 5.

The ABI also revealed that more consumer have filed for bankruptcy in the first ten months of this year than for the same period in 2009. According to the ABI, approximately 1.3 million Americans have filed for bankruptcy so far in 2010. This number is up from last year, when approximately 1.2 million consumers had filed for bankruptcy at this time.

Source: ConsumerAffairs.com "Consumer Bankruptcy Filings Up Slightly In October," James Limbach, 3 Nov. 2010

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