Bankruptcy filings continues upward

Following a national trend, the number of Iowans filing bankruptcy continues rising to new record highs every year. For the fiscal year that ended June 30th, there were more than one-and-a-half million cases in the U.S., an all time high for any 12-month period. One Davenport law firm has handled thousands of cases since it opened in 1952. Lawyer Jack Prescott says back then, bankruptcy was viewed much differently.At that time, Prescott says “There was a horrible stigma against this sort of thing, especially in small towns. A person if he filed bankruptcy, of course it would hit all the local merchants and he would be socially ostracized. Now, it’s a matter of course, very little stigma involved at all.” In 2002, more than 11-thousand-700 Iowa businesses and individuals filed bankruptcy, and the number is approaching 75-hundred already in 2003. Prescott attributes some of that to excessive use of credit cards. Prescott also blames the sour economy and a new law Congress is expected to consider this month. The law, pushed by credit card companies, would make it harder for people to file for Chapter 7, in which most of a person’s debts are canceled. They would then have to file for Chapter 13, which has a person still responsible for debts under a payment plan.