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The Honolulu Advertiser
Posted on: Tuesday, February 2, 2010

January filings for bankruptcies grow

Advertiser Staff

Hawaii news photo - The Honolulu Advertiser
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Bankruptcy filings continued to rise with the start of the new year, with 276 people and companies seeking protection in the U.S. Bankruptcy Court for Hawai'i.

But the increase was not as high as it has been on a percentage basis in more than a year, giving some hope that the worst of the increases in bankruptcies may be over for now.

The 33 percent rise in bankruptcies compared to a year earlier was the second-lowest increase in the past 21 months, or since May 2008.

Bankruptcies surged in 2008 as the economy sank into recession, with people and companies caught up in a credit crunch and financial problems seeking protection in bankruptcy court. Last year the number of filings continued to rise, hitting a five-year high.

Bankruptcy data gleaned from the Bankruptcy Court's Web site also shows the number of Chapter 7 bankruptcy liquidations increased in January to 217 from 170 a year earlier.

The number of Chapter 13 bankruptcies, a type of bankruptcy sought by homeowners trying to keep their homes by rescheduling creditor payments, jumped by 58 percent compared with January 2008. The total number of Chapter 13 filings was 60 during the month.

There was one notable business filing E.R.T. Sales of Hawaii, which operates the Price Busters chain of stores filed for a Chapter 11 reorganization during the month.

There has been some debate over whether filings are moderating or whether the state will continue to see high levels as financial problems catch up with people and firms.