US bankruptcies surged by 35% during a year

According to data released Thursday by the Administrative Office of the US Courts. US bankruptcies increased considerably, growing by 35% during 12 months period ended June 30. That happened as the financial crisis affected families harder than companies. 

Thus, between July 2008 and June 2009 around 1.3 million bankruptcy filings were made in American courts, compared to 968,000 during the previous year period. Moreover, 1.25 million of them appeared to be personal bankruptcies cases, while only 55,000 – devoted to corporations. 

General Motors and Chrysler, was seen as the most high-profile filers for Chapter 11 bankruptcy protection, that lets companies reorganize without being asked by creditors for immediate debt repayments. 

Chapter 11 filings grew by 91%, reaching an amount of 14,000. Chapter 7 filings made up 908,000, which require debtors to sell their property, that is up 47%, while Chapter 13 filings drifted higher by 12% rising to 384,000. In compliance with Chapter 13, debtors must come up with a plan to repay their creditors.