Personal bankruptcy filings in Connecticut rose more than 14 percent in 2010 as the poor economy continued to wreak havoc on individual’s finances.
A total of 9,887 individuals filed for bankruptcy last year , up from 8,641 in 2009, according to a new report from The Warren Group, a Boston-based publishing company.
The near 10,000 Chapter 7 bankruptcy filings in 2010 is the highest number recorded since 2005, when there were 13,259 filings.
Chapter 7 is the most common option for individuals who are seeking relief from their debts, and accounted for 89 percent of bankruptcy filings in Connecticut in 2010.
Chapter 7 bankruptcy filings also accounted for more than 90 percent of all filings tracked by The Warren Group in the fourth quarter of 2010. Chapter 7 bankruptcy filings totaled 2,348 in the fourth quarter, a 0.17 percent decrease from 2,352 during the same period in 2009.
“Bankruptcy filings reflect the economy as a whole – and it’s clear we are not on a fast path toward recovery. Consumers are clearly struggling to pay off the debt they’ve accrued over the years, and are turning to bankruptcy as a last resort,” said The Warren Group CEO Timothy M. Warren Jr.
People filing under Chapter 7 bankruptcy can eliminate most debt after non-exempt assets are used to pay off creditors. In contrast, Chapter 13 requires debtors to arrange for a three- or five-year debt-repayment plan.
Chapter 13 bankruptcy filings decreased 5 percent to 1,087 in 2010, from 1,145 in 2009.
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