US personal bankruptcy filings jumped 40 percent last year as a result of rising mortgage payments, job losses and other financial pressures.
The increase followed a sharp decline from a year earlier, when Congress passed a new law that made it more difficult for consumers to apply for bankruptcy-court protection from their creditors.
More than 800,000 personal bankruptcy filings were made last year, compared with more than 573,000 in 2006 -- the lowest level since 1998, data collected by the National Bankruptcy Research Center and published by the American Bankruptcy Institute, a research group in Alexandria, Virginia, showed.
TREND
Samuel Gerdano, executive director of the American Bankruptcy Institute, said in a statement that the trend is likely to worsen this year as consumers' high debt loads are "made worse by the home mortgage crisis."
Personal bankruptcy filings for most of this decade had been much higher -- around 1.5 million annually. But after an eight-year campaign by banks, retailers and credit card companies, Congress in 2005 passed the biggest changes in US bankruptcy laws in a quarter-century, mandating an income test to measure a debtor's ability to repay obligations.
Personal bankruptcy filings soared to more than 2 million in 2005, with more than 600,000 filings made in October, when the law went into effect.
CHAPTER 13
Consumers deemed to have insufficient assets or income can still eliminate debts through a Chapter 7 bankruptcy. But those with income above their state's median income who can pay at least US$6,000 over five years are forced into Chapter 13, where a debt repayment plan is ordered.
Now the pendulum on bankruptcy law could swing the other way.
As defaults and foreclosures grow, Congressional Democrats have been pushing for an expansion of bankruptcy judges' authority to reduce the size of home loans. Under existing law, bankruptcy judges cannot modify loan terms on a bankrupt borrower's primary residence, but are permitted to do so for mortgages on second homes.
Democrats say legislation allowing judges to do so could help more than 500,000 homeowners avoid foreclosure, while Republicans and the mortgage industry say expanding this power would make lenders far more reluctant to extend home loans.
MORE VISITORS: The Tourism Administration said that it is seeing positive prospects in its efforts to expand the tourism market in North America and Europe Taiwan has been ranked as the cheapest place in the world to travel to this year, based on a list recommended by NerdWallet. The San Francisco-based personal finance company said that Taiwan topped the list of 16 nations it chose for budget travelers because US tourists do not need visas and travelers can easily have a good meal for less than US$10. A bus ride in Taipei costs just under US$0.50, while subway rides start at US$0.60, the firm said, adding that public transportation in Taiwan is easy to navigate. The firm also called Taiwan a “food lover’s paradise,” citing inexpensive breakfast stalls
TRADE: A mandatory declaration of origin for manufactured goods bound for the US is to take effect on May 7 to block China from exploiting Taiwan’s trade channels All products manufactured in Taiwan and exported to the US must include a signed declaration of origin starting on May 7, the Bureau of Foreign Trade announced yesterday. US President Donald Trump on April 2 imposed a 32 percent tariff on imports from Taiwan, but one week later announced a 90-day pause on its implementation. However, a universal 10 percent tariff was immediately applied to most imports from around the world. On April 12, the Trump administration further exempted computers, smartphones and semiconductors from the new tariffs. In response, President William Lai’s (賴清德) administration has introduced a series of countermeasures to support affected
CROSS-STRAIT: The vast majority of Taiwanese support maintaining the ‘status quo,’ while concern is rising about Beijing’s influence operations More than eight out of 10 Taiwanese reject Beijing’s “one country, two systems” framework for cross-strait relations, according to a survey released by the Mainland Affairs Council (MAC) on Thursday. The MAC’s latest quarterly survey found that 84.4 percent of respondents opposed Beijing’s “one country, two systems” formula for handling cross-strait relations — a figure consistent with past polling. Over the past three years, opposition to the framework has remained high, ranging from a low of 83.6 percent in April 2023 to a peak of 89.6 percent in April last year. In the most recent poll, 82.5 percent also rejected China’s
PLUGGING HOLES: The amendments would bring the legislation in line with systems found in other countries such as Japan and the US, Legislator Chen Kuan-ting said Democratic Progressive Party (DPP) Legislator Chen Kuan-ting (陳冠廷) has proposed amending national security legislation amid a spate of espionage cases. Potential gaps in security vetting procedures for personnel with access to sensitive information prompted him to propose the amendments, which would introduce changes to Article 14 of the Classified National Security Information Protection Act (國家機密保護法), Chen said yesterday. The proposal, which aims to enhance interagency vetting procedures and reduce the risk of classified information leaks, would establish a comprehensive security clearance system in Taiwan, he said. The amendment would require character and loyalty checks for civil servants and intelligence personnel prior to
RSS