A Poor Economy Leads to a Windfall for Consumer Bankruptcy Attorneys and a 300% Increase in Chapter 7 and Chapter 13 Petition Preparations for Perfect Petitions

Denver, CO, August 13, 2010 --(PR.com)-- As the trend for indebtedness is still rising in 2010 and many more Americans are seeking Bankruptcy Protection to shed mountains of debt, consumer bankruptcy attorneys now find that they cannot keep up with the tidal-wave of clients who are pouring into their offices.

Bankruptcy filings have continued their increase substantially, nearing 379,000 for the first quarter of 2010, an increase of 17 percent from the first three months of 2009. In fact, total filings by Chapters 7, 11 and 13 for the period ending in 2009 was 1,202,395, according to statistics available from the U.S. Bankruptcy Court. For the same chapters and period ending in 2010, the total was 1,531,997. This fact leaves little doubt that we will exceed that number next year.

A 2005 federal law restricting bankruptcies had a large immediate impact on filings, reducing the amount of bankruptcies filed after its passage. However, despite the law creating new rules which were supposed to make filing bankruptcy more expensive and difficult for consumers, instead, consumer bankruptcy filings are nearly back to the level they were before the law's passage, and are now on point to surpass bankruptcy levels prior to the law's enactment.

Fewer people are turning to credit counseling for assistance, as many times they are far too deeply in debt or have waited too long to turn to credit counselors for help. As a result, it generally is too late in the process to work with the creditors, leaving only one option for financial relief: bankruptcy.

The next place to turn is the local consumer bankruptcy attorney, who now must scramble to help their clients obtain the needed debt relief which the bankruptcy laws provide. This influx of new clients has left many consumer bankruptcy attorneys strapped for time and resources, in an attempt to keep up with the new work. This windfall for bankruptcy attorneys has spawned new business opportunities for companies who provide support services to attorneys, such as paralegals, bankruptcy software vendors and legal assistants.

Michael Hastings, president of Perfect Petitions, a virtual bankruptcy assistant service located in Denver, Colorado which provides Bankruptcy Petition Preparation services to attorneys nationwide, has reported that his company has seen a 300% increase in Chapter 7 and Chapter 13 Petition Preparations over the last 3 months, as potential clients are contacting him simply stating, "we cannot keep up with this volume." Although he welcomes the work, Mr. Hastings also states that it is "deeply disturbing" that the Congressional rule enacted in 2005 appears to have little impact on reducing the amount of Bankruptcies filed, but acknowledges that the rule did nothing to address the "foundational financial issues" which lead many Americans to seek bankruptcy protection, such as increasing medical cost, double-digit unemployment, substantial reductions in long-term investment worth and increasing foreclosure filings.

As many existing consumer bankruptcy attorneys find themselves with the good problem of "too much business," the long term effect is that many attorneys practicing in other legal areas have now added bankruptcy law to their repertoire. "I have had several attorneys who have never filed a Bankruptcy Petition call my office for assistance, as I believe they realize there is a unique opportunity to increase their practice and add clients who can potentially utilize their other legal services in the future," states Mr. Hastings.

For the foreseeable future, it appears that consumer bankruptcy filings will continue to increase, at least until something is done to address the issues in the financial market that have lead to such an influx of filings.

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