Consumer Bankruptcy Filings Up in February

Washington, DC, March 4, 2010--Consumer bankruptcy filings were up 14% in February compared with a year earlier, according to the American Bankruptcy Institute.

The 111,693 cases filed last month was a 9% increase from January, the report said.

Financial distress is driving more Americans to file for Chapter 7 bankruptcy, which, allows a court to discharge most unsecured consumer debt, including credit card bills.

When a stricter bankruptcy law took effect in 2005, a major goal was to require more families to rely on Chapter 13 bankruptcy, which requires filers with regular income to repay debts in full, or in part, over several years.

Yet the number of Chapter 13 filings decreased 3% last month from January, the American Bankruptcy Institute says.

Last year, there were 1.47 million bankruptcy filings, up 32% from 2008, according to the Administrative Office of the U.S. Courts.