Although bankruptcy laws have changed, giving the courts more discretion in granting petitions, thousands of people still file for bankruptcy protection every year.
Bankruptcy filings are not relegated to any particular group of people. Those who file stretch across the whole spectrum of our society, from the poor, the middle class, and the wealthy.
On any given day, you may see doctors, lawyers, engineers, accountants, hourly workers, small businesses, large businesses, corporations, entertainers, sports figures, and people from all other professions, in bankruptcy court.
Why? Because they all need some sort of debt relief or debt restructuring. The reasons for filing for bankruptcy may vary with each individual or company, but in most cases, it is because they have acquired more debt than they can handle.
There are surges in the amount of bankruptcy filing during certain changes in the ecomony. If for instances, the country goes through a recession or a slowdown in economic growth, you may see more people filing for protection than usual.
On the other hand, when there is growth in the economy and the production of goods and services are up, you will probably see the number of bankruptcy filing decline.
This is because businesses prosper during these periods, salaries increase, and there is more of a sense of wellbeing.
But during times of economic growth, people tend to overspend and take more risks with their money, which in turn, bodes bad for them when the economy slows down.
There are many other reasons why people file for bankruptcy. There may be a job loss, death of a spouse, long term health problems, legal issues, over abundant credit card debt, high mortage payments, and other issues.
For those who chose to file, it may take away a heavy burden and give them the opportunity to start their lives over.
In years past, there was a negative stigma about filing for bankruptcy and those who filed were generally frowned upon. But now, that stigma is not as prevelent but for many, filing for bankruptcy protection is still something that is personal and they want to keep it secret.
Over the years, bankruptcy filings have become more and more commonplace, thus, making it necessary for the government to place more stringient guidelines on filing and making it harder for individuals and companies to take unfair advantage of their creditors.