Data on individual filers are scanty as well, and for good reason: The official statistics collected by the Administrative Office of the U. Carroll Credit Center: In other words, the debtor is no longer legally required to pay the discharged debts. Consequently, they might also be expected to significantly affect the personal filing rate. The court will normally reopen the case if liquidating the asset will benefit the creditors. Other studies have had less success in identifying the role played by bankruptcy law incentives.
The varying provisions of the means-testing proposals and researchers' differing assumptions about the amount of income that filers could keep for living expenses while repaying their debts accounted for most of the differences; the remaining variation probably only a small part overall reflected differences in the samples of filers that the studies used.
Shaded areas in figures represent recessions as defined by the National Bureau of Economic Research. For the year ending June 30, 1998, for example, the rise in the personal filing rate reflects the rise in the risk of default at the end of calendar year 1996. Indeed, evidence compiled by the Board of Governors of the Federal Reserve System indicates that borrowing increased broadly throughout the population during the 1980s and the first half of the 1990s.
This is called delayed discharge. CBO chose to indicate the break when appropriate and, after 1979, to use the number of nonbusiness bankruptcy filings to calculate the personal filing rate.What is the Difference Between a Bankruptcy Discharge and Dismissal?
When you're discharged from bankruptcy, you're freed from any debts that were included in your bankruptcy. Yet because households have some control over that risk, changes in its trend do not completely explain changes in the personal filing rate. However, you can voluntarily make payments on the debt to ensure that it's paid in full, especially if you received the benefit from the debt. Consumers who formerly could not get the credit they wanted have found it much easier to obtain in the past 20 years.
The greater the fresh start, the greater are the incentive to borrow and the cost of borrowing.
The homestead exemption is a good example of how dollar values for asset exemptions differ among the states. Growth in the filing rate tends to increase or decrease in the year following a greater or smaller increase in the debt-service burden. Toggle navigation AllLaw.