November 2010 saw a change sweeping through Washington and the country. Republicans regained the majority in the House and made some major gains in the Senate. With new faces in both chambers, new leaders in the House and a steady number of Bankruptcies being filed in the United States, what effect will these changes have on Bankruptcy?

Through the end of September 2010, there were approximately 1.1 million bankruptcy filings in the United States and its Territories according to the United States Bankruptcy Court. A look back at the 12-month period from September 2009 to 2010 shows that approximately 1.6 million cases were filed.  Compared to the 12-month period from September 2008 to 2009, that was an increase of nearly 200,000 filings.  Projections indicate that the number of filings for 2011 may decrease by a small margin. Will the reshaped Congress have any effect on the number of filings? Time will tell, but the chances of seeing the oft talking about change in the Bankruptcy law as to the cram down of mortgages is not likely.

Home Affordable Modification Program (HAMP) was another hot topic in 2010. However, the number of homeowners who were able to qualify for the program to receive permanent modifications and stay current on the modified payments remains low. Although this is a Treasury Department initiative, will we see any changes to the program in 2011? Will there be a Congressional Directive?  Will the investigations that the State Attorney Generals are spearheading lead to rules in individual states that then will carry over into Bankruptcy? These are questions that we hope to find answers for in early 2011.

Change is typically a good thing. However, how the waves of change affect creditor’s accounts in Bankruptcy is like the outcome of a good mystery novel: “To Be Determined.” 

Weltman, Weinberg & Reis will continue to keep you updated on what is occurring in Washington and its effect on Bankruptcy.

If you have any questions on this matter, please contact Alan C. Hochheiser, Esq. Alan is the Managing Partner of the Bankruptcy Practice Group of Weltman, Weinberg & Reis Co., LPA located in the Brooklyn Heights, Ohio office. He can be reached directly at 216.739.5649 or .