The rush to file for bankruptcy continued Saturday as two dozen workers at the U.S. Bankruptcy Court worked through the weekend to handle last-minute petitions before a new law makes it more difficult to qualify for Chapter 7 protection.
Officials at the Denver court said lawyers had filed 816 petitions electronically by 3:30 p.m. Saturday. That’s on top of about 3,200 paper and electronic filings Friday, and 1,984 total petitions received at the court Thursday.
Electronic filings made by attorneys on behalf of clients may be made until midnight tonight.
Other courts across the country also reported astronomical jumps in filings as the deadline loomed.
Filings in Denver have climbed throughout the week, with 1,500 arriving on Wednesday, said court Clerk Bradford Bolton. A normal day last year saw fewer than 100 filings.
A line several hundred people long snaked out of the white-columned courthouse, down the steps and around the corner for more than half a block all day Friday. Filers reported waiting from two to five hours, depending on when they arrived.
“This is far, far in excess of any of our wildest expectations,” said Chief Judge Sidney Brooks as he worked the line Friday afternoon in plainclothes with other court staffers.
“It’s not the end of the world that you can’t file today,” he told one woman who arrived without papers because she thought she had until Monday. “It will be more expensive and complicated in the future, but you’ll still be able to file Chapter 7. Really, you should have filed a week ago or a month ago.”
The law will make it more difficult for high-income filers to escape debts in Chapter 7 by forcing them into Chapter 13, where most debts must be paid off. Based on interviews Friday, most people in line won’t be affected by that part of the law. But the changes are expected to raise the cost of filing bankruptcy by at least half. A typical filing now costs about $1,000 in legal expenses plus a $200 filing fee.
That appeared to motivate many who showed up Friday.
“All I know is that they’ll be raising prices on Monday,” said Damon Rogers, 27, of Aurora, who was there with his wife, Miranda, 25.
Others interviewed Friday were only vaguely aware of how the changes might affect them.
“I didn’t know what the new law has in store, so I decided to do it today,” said Tina Hinton, 28, a Colorado Springs student who said her husband left her with $20,000 in debt.
Staff writer Greg Griffin can be reached at 303-820-1241 or ggriffin@denverpost.com.
