When Congress passed the new bankruptcy changes in 2005 the purpose was to reduce the total number of personal filings across the country. Since then all statistics point to the fact that their endeavor was successful. The reason? They successfully made bankruptcy a far less attractive of an option for people suffering from debt. How they did it is a much more complicated answer.

According to pundits and debt consultants, the single biggest difference between the laws of today and yesterday lies in the bankruptcy means test. This refers to the requirement for debtors who owe more than the median in their state to prove that they can’t in fact pay at least part of the debt back in a Chapter 13 bankruptcy plan. After their income and expenses are scrutinized, if the debtors cannot in fact show that their need for financial relief is legitimate, then the courts can require them to file Chapter 13.

Detailed below is Maryland’s median income information as of 2006:

2-person families 66,190
3-person families 78,119
4-person families 94,017
5-person families 94,539
6-person families 91,061
7-or-more-person families 89,475

Are you thinking that your best option isn’t bankruptcy? Talk with an expert about all the debt solutions available to help you lower your monthly payments and total debt amount in some cases.

Maryland Bankruptcy Data

2004: 29,050
2005: 34,585
2006: 9,016

Maryland is another state that saw a dramatic downturn in the number of filings between 2005 and 2006. Of course the primary reason for this was not economic prosperity or a lack of debt problems in the state, but rather the fact that bankruptcy reform achieved its goal---to make bankruptcy a last resort. As a result more consumers have learned how to avoid bankruptcy by seeking out debt help from credit consolidation & management companies. In all the total bankruptcy filings in Maryland declined by 73.9% from 2005 to 2006.

Maryland Consumer Credit Counseling Services
Maryland Bankruptcy Laws
Maryland Debt Collection