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increase dramatically

Personal bankruptcies
increase dramatically

Personal bankruptcy filings in Western New York shot up dramatically over the past 12 months, says Judge Michael Kaplan, chief bankruptcy judge for the Western District.
The Western District encompasses the Buffalo and Greater Rochester areas as well as parts of the Southern Tier.
Kaplan yesterday released figures for the federal fiscal year ended Sept.

Personal bankruptcies
increase dramatically

Personal bankruptcy filings in Western New York shot up dramatically over the past 12 months, says Judge Michael Kaplan, chief bankruptcy judge for the Western District.
The Western District encompasses the Buffalo and Greater Rochester areas as well as parts of the Southern Tier.
Kaplan yesterday released figures for the federal fiscal year ended Sept. 30 that show a 28 percent jump in filings over the previous year.
Forty-one percent of the 1996 total were filed in the Rochester division, which consists of Monroe, Wayne, Ontario, Livingston, Yates, Chemung, Schuyler and Steuben counties.
Kaplan as a matter of policy does not speculate on why the number of individuals going broke seems to be rising.
But Rochester bankruptcy attorney Leonard Relin blames the boom in people going bust on banks’ overly liberal credit-card policies.
In more than two decades of practice, Relin said, he has seen the number of individual filings versus business bankruptcies skyrocket as charge-happy consumers run up bigger and bigger bills.
Trends he has observed are filings by younger individuals, and filings with lower asset and debt totals.
Typically, banks issue unsolicited cards to unemployed recent college graduates, who then proceed to build high balances with interest rates of 20 percent a year or higher, Relin said. Compounding the problem are balance-transfer offers that let overextended consumers run up even bigger balances.
He also blamed members of his own profession who run TV ads promising easy debt relief through bankruptcy for encouraging consumers to run up unpayable debts.
Business bankruptcies accounted for 8 percent of more than 9,000 new filings in the Western District during fiscal 1996.
Court officials could not supply statistics on business versus personal bankruptcy filings for earlier fiscal years. A comparison of calendar 1994 and calendar 1995 shows a 1 percent decline–from 10 percent to 9 percent–in business filings as a percentage of all bankruptcies filed.

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