Bankruptcy filers in frenzy

Facing a weekend deadline, thousands of people armed with bulging files of paperwork lined up at courthouses in Salt Lake City and around the nation Friday to seek bankruptcy protection from creditors before a new law makes it much more difficult to shed debt.

The number of cases filed before the law takes effect Monday was expected to set not only a national record but individual records in a number of states. Some clerks said bankruptcy filing records were beaten every day this week.

In Utah, several dozen filings are made in a typical day in bankruptcy court. But in the days leading up to the new law, thousands of filings have been processed by the U.S. Bankruptcy Court for the District of Utah.

On Friday alone, 1,402 Utahns had filed for bankruptcy protection by 6:25 p.m., according to the Utah court's Web site. By way of comparison, 1,324 Utahns filed for bankruptcy during the entire month of January.

Aaron Meier, owner of Aaronson Grand, a bankruptcy petition preparer based in West Valley City, said the past few weeks have been the busiest he has seen in the six years his company has operated.

Usually Meier handles three or four filings a day. In the past week, he has been swamped with roughly 30 filings a day.

In Denver, the line at bankruptcy court formed before dawn and quickly grew to more than 300 people as it stretched outside. Some pushed babies in strollers, while others sipped coffee and sodas.

Nursing assistant Colleen Christian brought her 14-year-old son to help her punch figures into a court computer after spending long days on Chapter 7 paperwork at her home in tiny Cotopaxi, 100 miles south of Denver. With credit card debt hovering around $25,000, she said she had no choice but to file before the law changed.

"It was a very hard decision because I've incurred these debts and I need to pay them," she said. "But it was such a weight."

In Chicago, people crowded the hallway outside a packed waiting room for their initial meeting with a bankruptcy trustee.

Substitute teacher Barbara Moore said she had been mulling a Chapter 7 filing for a few years when she heard about the pending law change. She was fearful medical expenses from a cancer diagnosis could add to her mounting credit card debt.

"That's when I decided to stop dillydallying," said Moore, 51. "It just sounds like it's going to be much more difficult and expensive later."