Orange County Bankruptcy Lawyer Blog

Divorce is seldom a painless process, but for power couple and Dodgers owners Frank and Jamie McCourt who face off in a Los Angeles courtroom this week, much more is at stake than 30 years of memories, the LA Times reports.

Divorce is a leading cause of bankruptcy filings in the Los Angeles area. Consulting a Santa Ana bankruptcy lawyer or a bankruptcy lawyer in Orange County can help protect your rights.

The LA Dodgers is a hundred million dollar a year franchise, one which neither Frank nor Jamie wish to lose interest. Both are now fighting to establish ownership rights and at least some control over the big-money future earnings the team promises.

While such grand stakes are uncommon to most Orange County couples contemplating divorce, the financial reorganization that frequently accompanies the painful process of divvying up a lifetime of community property can often land either or both in an L.A. bankruptcy court.

Splitting up assets, deciding who takes control over which bills and who reaps the benefits of formerly joint income can be a financially devastating process during a time already rife with emotional stress. Seeking the advice of a bankruptcy attorney, who understands divorce, can help protect the rights of a spouse now facing bankruptcy along with the dissolution of their marriage.

For the McCourts, what is up for debate is whether or not Jamie signed away her ownership rights to the Dodgers in exchange for sole possession of the couple’s many residences, the LA Weekly reports.

Jamie says she never read the document, “trusting her husband when he said the document was designed to protect the couple’s home from creditors,” the LA Times article reports. Frank counters that his wife knew exactly what she was signing whether she read it or not. Now, a judge will decide whether the document they both signed gives Frank sole ownership of the team.

Continue reading "Divorce of Dodgers owners illustrate how dissolving joint finances can drive couples to LA bankruptcy court " »

More than 1700 new Orange County bankruptcy cases were filed in July, an almost 25 percent increase from a year ago, further indication that for many Southern Californians facing high unemployment and the depressed economy, financial woes are far from over.

From the Central District to Los Angeles County, Californians everywhere are fighting a similar battle fueled by surging credit debts, underwater mortgages and depleted retirement plans, the Orange County Register reports.

For those who are continuing to struggle, finding and talking with an experienced, understanding, Santa Ana bankruptcy lawyer or Ontario bankruptcy attorney can assist you in determining a course of action that will allow you to regain control of your life.

L.A. County alone has seen a more than 50 percent spike in filings from a year ago, while markets from Sacramento to Santa Ana to San Diego continue to make the “top 15” hardest-hit counties for bankruptcy filings.

And it isn’t just homeowners who are taking the hit. According to a recent post on entrepreneur.com, it’s small business owners around the state and nation who are adding to the fresh wave of bankruptcies flooding the courts.

A recent study of quarterly business filings by the American Bankruptcy Institute found that last year alone more than 60,000 companies filed bankruptcies nationwide, a number that has been steadily tracking upward since 2006 and is highest on record since 1994.

Meanwhile, ABI reports, more than 28,000 companies nationally have filed for bankruptcy during the first two quarters of 2010. If the trend continues, the country is on track to see another 60,000 companies fold this year as well.

With the closure of these small businesses, unemployment numbers continue to climb, further fueling the downward economic spiral ravaging the savings, credit ratings and dreams of California workers and entrepreneurs alike.

Continue reading "Santa Ana remains bankruptcy hot spot as OC filings hit five-year peak" »

Lingering economic uncertainty has done more than destabilize our domestic and international financial markets. For Californians especially, who are among the hardest hit in the nation by the multi-faceted recession, as the household and living expenses mount, the security and structure of many families is threatened.

Both job seekers and employers are unsure about the future, leading to fewer hires and rising unemployment numbers. The housing market continues to stumble, and many Orange County homeowners are left watching helplessly as their savings disappear, their credit card debt increases and their credit scores tumble.

Many seeking advice from Orange County bankruptcy attorneys are being crushed by mounting debt, diminished income and plummeting home and commercial property values.

As many families struggle to stay afloat while considering their financial options, refinancing seems like a promising life-line. But according to a recent article in SF Gate, “lenders have been have been subjecting mortgage and refinance applicants to stricter and stricter criteria.”

In short, California homeowners, in their greatest time of need, are now facing a more challenging application process and lesser likelihood of refinancing approval.

The SF Gate article indicates that factor such as stricter income-verification standards and a more intense review of credit scores, paired with lender paranoia, restrictions on eligible income and inexperienced lenders can and do negatively impact a homeowner's chances to secure a low-interest refinance.

Finding and understanding, experienced and knowledgeable Santa Ana bankruptcy attorney can assist you in determining a course of action and help you regain control of your life.

Our team members will help you navigate the distinctions between filing a Chapter 7 or Chapter 13 bankruptcy, helping you deciding whether or not it is in your best interest to keep your home and putting a stop to harassing phone calls from debt collectors.

Continue reading "Inability to refinance or seek home equity loans can prompt consumer bankruptcies in Orange County" »

An additional $3 billion is being made available by the Obama Administration, including $1 billion in loans for the unemployed and $2 billion in funds for homeowners in the five hardest-hit states, including California.

Many of those filing for bankruptcy in Orange County are dealing with unemployment and/or bad real estate debt. For some, a loan modification or government program could provide assistance. But for many, seeking the advice of a Santa Ana bankruptcy lawyer is the best option for putting an end to financial problems and to seeking a new financial beginning.

CNN reports the $1 billion will be available in loans at 0% interest for amounts up to $50,000. The loans are aimed at assisting the unemployed keep their homes. The remaining $2 billion will be distributed to homeowners in the five hardest-hit housing markets: California, Arizona, Florida, Nevada and Michigan.

Few states have been as hard hit as California when it comes to the real estate market. Throw in record unemployment and it's no wonder why so many consumers are struggling. We assist clients throughout the Los Angeles area as they put a stop to the harassment of creditors and bill collectors and seize control of their lives again.

For many, a Chapter 7 filing is the best option. Sometimes known as a liquidation bankruptcy, a Chapter 7 bankruptcy filing will result in the elimination of most debt. You may even be able to keep your home or automobile, although it may make financial sense to include them in the bankruptcy. These are options you can discuss with us during your free consultation. In other cases, a Chapter 13 filing may make the most sense and will provide a consumer with the time and space necessary to establish a repayment plan and satisfy debts with little or no disruption to their lives.

Aside from unemployment and foreclosures, other leading causes of bankruptcy filings include divorce, medical bills and credit card debt.

Continue reading "Orange Counties bankruptcies often involve unemployment, foreclosure, bad real estate debt " »

Businessweek is reporting that U.S. consumer bankruptcies could top 1.6 million this year, after a reported increase of 9 percent in June.

As our Santa Ana bankruptcy attorneys reported last month on our Orange County Bankruptcy Lawyer Blog, the number of consumers filing bankruptcy in Orange County increased 40 percent during the first six month of the year.

Nationwide, the 137,798 bankruptcies in June represent a 9 percent increase from last year, according to the American Bankruptcy Institute.

“Debt burdens, unemployment and an uncertain economic climate continue to weigh on consumers,” Samuel J. Gerdano, the institute’s executive director, said in the statement. “The pace of consumer filings this year remains on track to top 1.6 million filings.”

The most common reasons for filing Chapter 7 bankruptcy in the Los Angeles area include bad mortgage debt, credit card debt, medical bills and divorce.

Last year's 1.4 million consumer bankruptcy filings represented an increase of 32 percent over 2008. In fact, bankruptcies have increased steadily since the implementation of the Bankruptcy Abuse Prevention Act. That law, which was pushed through by the banking industry, sought to make it more difficult to file Chapter 7, or liquidation, bankruptcies. It establishes an income to debt ratio and can require a repayment plan in certain instances.

But the reality is that insurmountable levels of consumer debt is what drives bankruptcy filings. Bankruptcy offers consumers the most powerful tool available to stop debt collectors, foreclosure, or other harassment while a consumer regains control of their financial life.

Continue reading "Nation on pace for record number of bankruptcy filings; Orange County is no exception" »

The number of people who filed bankruptcy in Orange County increased 40 percent in the first six months of 2010, the Orange County Register reported.

Our Garden Grove bankruptcy lawyers continue to report on the record number of consumers who are filing for Chapter 7 or Chapter 13 bankruptcy protection as a result of the collapsing real estate market and the economic downturn. Speaking with an experienced bankruptcy protection lawyer is one of the best ways to restore financial freedom and recover from job loss, a medical emergency or the crushing weight of consumer debt that can come with an upside down mortgage or unmanageable credit card debt.

The U.S. Bankruptcy Court for the Central District of California, which covers San Bernardino, Riverside, Orange, Los Angeles, Ventura, Santa Barbara and San Luis Obispo counties, reports that 6,500 Orange County businesses and individuals filed for bankruptcy protection between January and July of 2010. That rate is 40.3 percent higher than a year ago.

While the numbers of bankruptcies continue to grow,the rate is slowing. By comparison, the number of filings increased by 77 percent between June 2008 and June 2009. Authorities place the blame for the strain on consumers on a number of factors, including:

-Unemployment: 9.5 percent

-Housing foreclosures: Up 3.8 percent in first half of 2010

-Consumer debt: 2.4 trillion in May.

California small businesses are also leading the nation in the number of bankruptcy filings. Orange County small business bankruptcies represented 8.6 of all filings.

Continue reading "Orange County consumer bankruptcies continue to rise; small businesses continue to seek bankruptcy protection" »

The San Francisco Chronicle reports that the number of California bankruptcies continues to soar, despite the overhaul to consumer bankruptcy laws five years ago.

Our Riverside bankruptcy lawyers and Orange County bankruptcy attorneys continue to report on the record number of consumer bankruptcies occurring in the Los Angeles area and throughout California.

An estimated 120,000 California consumers could seek bankruptcy protection this year. Real estate debt, credit card debt and medical bills are the primary causes of consumer bankruptcy filings.

The overhaul of the bankruptcy laws was heavily lobbied for by credit card companies five years ago. The new rules created an income-to-debt test for consumers wishing to file for Chapter 7 protection. Chapter 7 bankruptcy completely forgives most debt, including credit card debt, but the new rules require certain consumers to establish a repayment plan. A Chapter 13 bankruptcy is the traditional form of bankruptcy that establishes a repayment plan.

Either filing will stop bill collectors and other harassment that frequently results when consumers reach the financial breaking point. Both means of bankruptcy protection can provide a fresh start and an end to the crushing weight of serious financial problems.

Those who backed the new rules believed the large spike in bankruptcies right before the new laws took effect in 2005 was an anomaly that would not be repeated. Those of us who fight for the rights of struggling consumers on a daily basis knew better. Insurmountable levels of consumer debt are what drive bankruptcies. And the banks and credit card companies have played a key role in building the high debt levels of American families, even as these companies fought to make it more difficult to seek bankruptcy protection.

Bankruptcy filings in California and nationwide are now approaching the elevated levels of 2005 in the months before the new laws took effect. The huge numbers of filings have restarted the debate over whether irresponsible consumers or predatory lenders are primarily to blame.

One thing is certain, the predatory lenders have their advocates. Consulting a bankruptcy attorney in the Los Angeles area will help ensure that your legal rights are protected as well.

Continue reading "Orange County bankruptcy lawyer can protect your rights against predatory lending" »

The Wall Street Journal reported that the number of consumer bankruptcies nationwide fell for the second straight month in May. However, those numbers are unlikely to signal the start of a permanent decline, particularly in hard hit areas like California and Florida.

As our Orange County bankruptcy lawyers and San Bernardino bankruptcy attorneys recently reported, Orange County bankruptcies increased by 50 percent in April. In the Los Angeles area, 1 in 6 consumers filed for bankruptcy protection last year.

Nationwide, consumer bankruptcy filings fell to 136,142 in May, down nearly 6 percent from April. However, personal bankruptcy filings are up 9 percent from a year ago and up 15 percent when compared to the first five months of last year. In some areas of California, bankruptcy filings have increased more than 300 percent since the start of the economic downturn.

For struggling consumers, Chapter 7 bankruptcy allows for the forgiveness of most debt while a Chapter 13 bankruptcy can establish a repayment plan. Either filing will stop creditors from hassling you at home or work, and can also stop the garnishment of wages, foreclosure proceedings and other debt collection measures.

Bankruptcy filings could top 1.6 million this year, compared to the 1.4 million bankruptcy cases filed in 2009. California could account for nearly 10 percent of all bankruptcies filed nationwide this year, with an estimated 120,000 consumers expected to seek protection in bankruptcy court.

California ranks 8th nationwide in the number of filings based on population, with 6.26 bankruptcy cases for every 1,000 residents. Nevada, Tennessee, Georgia, Indiana, Alabama, Michigan and Ohio have higher rates. However, California has by far the highest number of bankruptcy cases of any state in the nation.

Continue reading " Nationwide decline in bankruptcy filings unlikely to impact hard-hit California consumers" »

Nearly half of all U.S. families are drowning in credit card debt --carrying an average balance of $7,300, according to U.S. News & World Report.

Credit card debt is one of the leading causes of consumer bankruptcies. The Orange County bankruptcy lawyers and the Santa Ana bankruptcy attorneys at the Shakoori Law Group assist residents in the Los Angeles are who are overwhelmed by consumer debt.

5 Ways to Reduce your Credit Card Debt:

1)Pay more than the minimum: Paying just the minimum will add years to the length of time needed to pay off your credit cards and will result in thousands of dollars in extra interest payments. A balance of $2,000 with a 19 percent interest rate will take nearly 8 1/2 years to pay off if you make just the minimum payment of $80 a month. Interest charges would total $1,179. Paying $160 pays the debt in under 2 years and saves nearly $1,000 in interest.

2) Ask for a lower interest rate: Some banks are willing to negotiate, particularly if you have not fallen behind on your payments. Reducing the interest rate on a $5,000 balance from 20 percent to 15 percent will save $300 a year.

3)Don't pay annual fees: In response to the economic downturn and consumer protection laws aimed at banning some of the most blatant practices employed by credit card companies in the past, many companies are now opting to charge card holders with an annual fee. Consider switching to a card with no annual fee. (A word of caution, closing an older, established account, can reduce your credit score).

4) Skip loyalty programs: These programs are good ... for the credit card company. Typically the costs associated with loyalty programs exceed any potential benefits.

5) Cut the plastic and pay cash: Studies continue to show that people are more aware of their spending habits when they use cash instead of credit.

While these tips are all good advice, there comes a time when some consumers need to honestly admit that they are in over their heads. Speaking with an experienced bankruptcy attorney can be the beginning of a fresh start. Chapter 7 bankruptcy in California is available to borrowers who meet certain income-to-debt ratios, while Chapter 13 bankruptcy will permit consumers to establish a repayment plan. Filing for bankruptcy protection will also immediately stop bill collectors and credit card companies from hassling you and your family.

Continue reading "Orange County bankruptcies frequently involve credit card debt " »

Orange County bankruptcies and business and personal bankruptcy filings skyrocketed nearly 50 percent in April, the Orange County Register reported on Friday.

As our San Bernardino bankruptcy attorneys and Riverside bankruptcy lawyers reported recently on our Orange County Bankruptcy Lawyer Blog, about 1 in 6 local residents filed for bankruptcy protection last year in the Los Angeles area. The fact that filings increased 50 percent in April over last year's figures is a startling reminder of the financial stress consumers still face in Southern California.

Filing for bankruptcy is a powerful tool that offers consumers a new beginning. Californians are continuing to seek protection in record numbers in response to the real estate bust and the economic downturn. For those who meet certain criteria, Chapter 7 bankruptcy offers a chance to completely erase most debt, including credit card debt, medical debt and judgments or liens. For others, Chapter 13 bankruptcy will allow you to structure an affordable repayment plan. In either case, bankruptcy will stop creditors from hassling you at work or home and will provide the space and time you need to help reclaim your financial freedom and independence.

Compared to last year, bankruptcy filings increased in April across the California Central District of the U.S. Bankruptcy Court, which covers five counties from San Luis Obispo County to the Arizona border, including Santa Ana, Los Angeles, Riverside and San Bernardino counties.

Area California bankruptcy filings for April 2010:

-Orange County: Up 48.8 percent to 1,682 from 1,130.

-Los Angles Up 71 percent to 4,835 from 2,828.

-Riverside/San Bernardino: Up 36.1 percent to 3,818 from 2,805.

-Southern California: Up 43.6 percent to 12,425 from 8,655.

Continue reading "Orange County bankruptcies jump nearly 50 percent in April " »

A case this week issued out of the Northern District of California illustrates why area residents considering bankruptcy should consult with an experienced attorney to protect their rights.

Our Santa Ana bankruptcy attorneys and San Bernardino bankruptcy lawyers understand considering bankruptcy or facing significant financial problems is a stressful time in your life. But don't compound your problems by attempting to represent yourself.

In this case, a California man completed the paperwork himself and filed for Chapter 7 Bankruptcy in January. He listed both a street address and a post office box, which he identified as his mailing address. The court sent a request for additional paperwork to the post office address, and the defendant failed to comply within 14 days, as required by law.

The court dismissed the case on Jan. 21 and on Feb. 4, his home was sold at a foreclosure sale. He then filed another petition for Chapter 7 Bankruptcy, thereby starting a second bankruptcy case in federal court. He wrote a letter to the court, which reinstated the first case and voided the second case. However, no actions taken during the lapse -- including the sale of his home at foreclosure action -- were invalidated.

The man then argued to the court that the foreclosure sale should be invalidated because the court sent notice to the wrong address -- he said the post office box belonged to his mother, who died and left him without access to his mail. He argued the bank had taken possession of the house when no credible buyer came forward at the auction, so the foreclosure sale could be set aside without harming a buyer.

The court ruled on behalf of the bank and the man lost his home. His bankruptcy case is still before the court and has not yet concluded. No word yet on whether he has hired an attorney.

This case illustrates the importance of hiring professional legal help when dealing with a California bankruptcy. Bankruptcy is handled in federal court and the results will remain with you for years. Failure to properly file can have all sorts of unintended legal consequences. One of the most common mistakes is not properly listing all creditors. An executed bankruptcy that does not include a creditor will leave a consumer open to collection action without the ability to seek additional bankruptcy protection.

Continue reading "Consulting an experienced Orange County bankruptcy attorney vital to protecting your rights" »

Six out of every 1,000 California residents have filed bankruptcy in the last year, the Orange County Register reported.

As our Riverside Bankruptcy attorneys reported recently on our Orange County Bankruptcy Lawyer Blog, the number of California bankruptcies has continued to rise even as bankruptcy numbers nationwide have leveled off or started to decline. Using the Register's figures, the number of area residents who have filed bankruptcy in the last year:

-12,600 Bankruptcies in Riverside County
-18,156 in Orange County
-12,090 San Bernardino County

The recession and collapse of the real estate market have brought financial hardship to the doorstep of struggling families. Bankruptcy remains a powerful tool to reclaim your financial footing and the future financial well-being of you and your family. The number of California bankruptcy filings has tripled the last 3 years.

The new statistics, which represent 12 months of bankruptcy filings through March 31, rank California 8th in number of bankruptcy filings compared to total population. The state ranks first by a wide margin for total number of bankruptcies.

Nationwide bankruptcy filings per 1,000 residents:

1)Nevada: 11.7
2)Tennessee: 8.55
3)Georgia: 7.8
4)Indiana: 7.62
5)Alabama: 7.42
6)Michigan: 7.11
7)Ohio: 6.26
8)California: 6.15
9)Illinois: 6.04
10) Kentucky: 6.03

A total of 1.47 million bankruptcies were filed nationwide in the last 12 months, a 25 percent increase compared to the 1.15 million filed in the previous 12 months. Just 674,000 were filed in the 12 months ending in 2007, before the economic downturn.

Nationwide bankruptcy filings increased in each category:
Chapter 7 (personal or business liquidation): Up 34 percent to 1.1 million.
Chapter 13 (personal reorganization): Up 12 percent to 415,966.
Chapter 11 (business reorganization): Up 30 percent to 15,251.
Chapter 12 (farm bankruptcies): Up 65 percent to 605.

Continue reading "Orange County bankruptcies filed by 1 in 6 consumers in the past year" »

Changes to the U.S. bankruptcy laws in 2005 could be partly responsible for the meltdown of the real estate market, several California researches argue.

As our Los Angeles bankruptcy attorneys reported recently on our Orange County bankruptcy Blog, the number of California bankruptcies has skyrocketed, from 34,000 in 2007 to an estimated 120,000 this year.

The 2005 law toughened the restrictions for filing Chapter 7 Bankruptcy, which eliminates most types of consumer debt. Under the new law, consumers who don't meet a certain debt-to-income threshold can be required to establish a repayment plan. But perhaps the biggest impact reform had is in scaring struggling consumers and homeowners from seeking the help they need and deserve. Consumers who are facing financial difficulty should consult an experienced Los Angeles bankruptcy lawyer as early as possible to discuss the best course of action for regaining solid financial footing.

Now officials are questioning whether the resulting squeeze on consumer budgets helped cause the meltdown, according to a report by FOX News. The report cited three prominent economists -- including Michelle J. White of the University of California at San Diego and Ning Zhu of the Graduate School of Management at the University of California.

“Bankruptcy reform squeezed homeowners’ budgets by raising the cost of filing for bankruptcy and reducing the amount of debt discharged in bankruptcy," the economists argue. "It therefore increased mortgage default by closing off a popular procedure that previously helped financially distressed homeowners save their homes.”

They content bankruptcy reform immediately increased foreclosures by 200,000 per year and has had a snowball effect as the economy worsened.

An experienced attorney can protect your rights under the law and help ensure the future financial well-being of you and your family. Bankruptcy remains a powerful and effective tool to protect consumers.

Continue reading "Bankruptcy reform influenced real estate collapse; Los Angeles bankruptcy firm can help" »

U.S. bankruptcy filings, for both individuals and businesses, fell 4 percent in April, Bloomberg Businessweek reported.

While it is the first small sign of stabilization, consumer bankruptcies in hard hit areas like California, Nevada and Florida are likely to remain elevated for the foreseeable future. As our Orange County bankruptcy attorneys reported last week, California bankruptcies handled by the Central District Court could reach a record 120,000 filings this year -- four times the annual bankruptcy filings reported in 2007 before the economic downturn. The Central District handles bankruptcy filings in Riverside, Los Angeles, Orange County, Santa Barbara, San Bernardino, Ventura and San Luis Obispo.

States that continue to report the largest increases in monthly bankruptcy filings include California, Hawaii, Virginia and Vermont. The states with the most filings per resident were Nevada, Tennessee, Georgia and Michigan.

Despite the decline in filings nationwide, Businessweek reported April filings remained at the second-highest level since bankruptcy laws were tightened in 2005 in an effort to make filing for bankruptcy more difficult for consumers. The primary change involves consumers filing for Chapter 7 Bankruptcy, which eliminates most debt. The new rules can require repayment of certain debts for consumers who do not meet a certain income-debt ratio. Speaking with an experienced Los Angeles bankruptcy attorney can help determine the solution that will best address your financial situation.

The record for bankruptcies was 2.1 million in 2005, a figure inflated by an estimated 630,000 consumers who filed in the two weeks before the new rules went into effect.

Nationwide, bankruptcy filings totaled 146,000 in April. March filings were about 158,000. Those figures represent a 4 percent daily decline in bankruptcy filings. There is some question about whether the majority of the decline involved commercial bankruptcies; some experts suspect consumer bankruptcies continue to increase as families battle high credit card debt, underwater mortgages and high levels of unemployment.

Continue reading "Bankruptcies decline nationwide; California bankruptcies expected to continue to 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.

Continue reading "California consumers continue to struggle; number of Orange County bankruptcies on the rise" »