California consumers continue to struggle; number of Orange County bankruptcies on the rise
The number of Orange County bankruptcy cases increased about 50 percent during the first quarter of 2010 compared to last year's levels, according to the statistics released by the United States Bankruptcy Court for the Central District of California.
While the economy and real estate market make small steps toward recovery, overburdened consumers continue to struggle. Speaking with an experienced Orange County bankruptcy attorney about your options can be the best course of action to protect the future financial well-being of you and your family.
Consumers faced with insurmountable debt need not fear the social stigma once associated with bankruptcy, as California residents have turned to the court for protection in records numbers. At the current rate, the court could hear four times more bankruptcy cases this year than it heard in 2007 before the downturn.
The Central District hears bankruptcy cases from seven California counties, including Orange County, Los Angeles, Riverside, San Luis Obispo, Santa Barbara, San Bernardino and Ventura. In March, 1,708 Orange county residents and businesses filed for bankruptcy protection. Los Angles bankruptcy filings totaled 5,190 while filings in Riverside and San Bernardino counties totaled 4,078.
Chapter 7 Bankruptcy: The court reported a total of 7,030 filings in January (up 54 percent), 7,801 filings in February (up 43 percent) and 10,078 filings in March (up 54 percent).
Chapter 11 Bankruptcy: 114 filings in January (up 96 percent), 83 filings in February (up 12 percent) and 93 filings in March (down 50 percent).
Chapter 13 Bankruptcy: 2,102 filings in January (up 46 percent), 2,025 filings in February (up 32 percent) and 2,658 in March (up 55 percent).
Chapter 7 bankruptcy will discharge most debt (with the exception of tax liens, student loans and some other types of exempt debt) and is available to consumers who meet certain debt thresholds and other criteria. Chapter 13 typically involves a repayment plan, with some debt being forgiven at the end of the terms. Chapter 11 bankruptcy is typically used by businesses seeking to reorganize under the protection of bankruptcy court.
While the numbers are a sobering reminder of the toll the financial crisis has taken on California residents, they tell only part of the story because 2009 numbers were already up 64 percent over 2008.
A total of 108,660 bankruptcy cases were filed in the Central District in 2009, compared to 65, 909 in 2008 and 34,040 cases in 2007. At the current pace, the number of filings this year could top 120,000 -- four times the number filed before the economic downturn.
Consulting an experienced Orange County bankruptcy lawyer can assist you in determining the options available for dealing with your financial situation. The Shakoori Law Group, a law firm dedicated to bankruptcy, debt collection defense and consumer rights matters, can be reached at (877) 529-4545.
