After a period of relatively low bankruptcy filings during 2006-07, U.S. consumer bankruptcies rose sharply in 2008 and continue to climb in 2009. Consumer filings reached 126,434 in July, the highest monthly total since the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) was implemented in October 2005, and pushed the consumer total for the first seven months of 2009 past 800,000 filings.

ABI Executive Director Sam Gerdano expects the consumer filing total to top 1.4 million in 2009, reflecting the sustained and growing financial stress on U.S. households. "Rising unemployment on top of high pre-existing debt burdens is a formula for higher bankruptcies through the end of this year," he said.

While consumer filings reached their highest levels in 2005, when over two million individuals rushed to file for bankruptcy before the implementation of BAPCPA, rising household debt, falling home values and unemployment are contributing to the current increase in personal bankruptcies. Historically, consumer bankruptcies correlate with household debt levels, according to Gerdano. As debt increases (from mortgages, non-revolving debt, credit cards, auto loans and home equity loans) bankruptcy filings also tend to increase.  For additional statistics and analysis of bankruptcy or debt-related issues, please click here.