Tuesday, September 20, 2011

Increase in Bankruptcy Filings by College Graduates


The typical person filing bankruptcy has historically been the low-income, under-educated people of our society. But with the downturn in the economy, there are more and more people with college degrees that have ended up filing bankruptcy. Even some upper income folks have turned elected to seek bankruptcy protection when their investments went South.

While 70% of bankruptcies are still comprised of people that did not graduate from college, graduates filing under BAPCPA have increased by 20% according to a study of more than 50,000 people covering 2006 to 2010. There has also been an increase in unemployed persons filing by 21% since 2006.

There was a 12% increase in married people filing since 2006, with married people making up more than 60% of all filings; however, only 35% of those petitions were joint petitions. A majority of the people filing experienced a decrease in income, or lost their jobs, while they had credit cards overextended. Bankruptcy filing peaked in 2010, when approximately 1.5 million people filed.

Of the people filing, when broken up into groups, there was an increase in all groups, with the exception of African-Americas, where the filing dropped to 11.3% from 15.4%.

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