Gagic -Study Finds Chapter 13 Bankruptcy Protection More Prevalent among Blacks

According to a study that is due to be published later this month in the Journal of Empirical Legal Studies, there is a wide disparity between bankruptcy filings by black Americans versus white Americans. Black Americans are much more likely to file for Chapter 13 bankruptcy proceedings, which typically tend to be not just more expensive but alsooften drag out longer than Chapter 7bankruptcy proceedings.

The study was conducted by professors at the University Of Illinois and the Rest of Arizona. They were looking for racial differences in bankruptcy filings betweenwhites and blacks in the United States. They found that racial differences did exist in bankruptcy filings, even when the financial situation of the petitioner was the same. Blacks were much more were likely to file for Chapter 13 bankruptcy protection, even when they had the same financial situations as whites in the study.

The study does not explain why more blacks seem to file for Chapter 13 bankruptcy protection than whites do. The researchers found this to be true throughout the country, although Chapter 13 bankruptcy filings seem to be a little more popular in the South.

In 2005, bankruptcy reform laws were enacted in order to encourage more debtors to use Chapter 13 protection, because this was seen as being more beneficial in helping debtors repay debt. However, Chapter 7 is the preferred mode of personal bankruptcy protection because it is quicker, cheaper, and typically has a higher success rate than Chapter 13.
That doesn’t mean that Chapter 13 is a terrible choice for all persons facing bankruptcy. Arizona foreclosure lawyers often recommend Chapter 13, when it seems like this kind of filing will boost the chances of the person of protecting the house from foreclosure.

Lily Mitchell is planning to hire the services of a bankruptcy attorney Phoenix after learning how a bankruptcy lawyer Phoenix can help him with his current financial situation.

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