March 18th, 2010 by Reed Allmand 
Chapter 7 bankruptcy filings increased by 14 percent in February while Chapter 13 bankruptcy filings decreased 3 percent compared to January. The irony is that when stricter bankruptcy laws took effect in 2005 they were intended to force more indebted families to file Chapter 13 bankruptcy and repay at least part of their creditors. Many opponents of bankruptcy falsely claimed that the bankruptcy system was being severely abused by hordes of debtors searching for an easy way out of their troubles. However, despite the changes to the bankruptcy code more people file For Chapter 7 bankruptcy than Chapter13 bankruptcy and that trend is expected to continue. Two of the most common reasons that more debtors are filing Chapter 7 bankruptcy are the housing crisis and the high unemployment rate which is creating a domino effect of foreclosures and bankruptcy filings in almost every state. Even if debtors wanted to file Chapter 13 bankruptcy, many of them cannot create a repayment plan that is feasible because they lack the income or their debt level is far greater than their income. For many debtors with high debt levels and low income, it is just not possible for them to repay their mounting debts.
Also, many debtors who attempted to avoid bankruptcy by refinancing their homes, are now facing bankruptcy despite their efforts because their financial situation has not improved. Those debtors who refinanced their home to avoid bankruptcy in hopes of something turning around in their financial lives are now in desperate need of bankruptcy because they cannot afford to repay their loans. Those debtors are making up an increasing number of individuals and families filing Chapter 7 bankruptcy.
About Reed Allmand
Allmand's vision is rooted in his own financially precarious childhood in Abilene "My father always had difficulty holding a job and supporting our family, so after my parents divorced when I was 12, my sister and I got jobs to help make ends meet," he recalls. "I remember what it felt like as a child to worry that our car would be repossessed or home foreclosed on."
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