Bankruptcy Filers Play Catch Up for at Least a Dozen Years
Individuals who file for bankruptcy are at a disadvantage for a dozen years in terms of savings and even longer in terms of net worth and home ownership, according to a study by a law professor and research scientist.
The study found that bankruptcy filers were more likely to be divorced, female, less educated and residents of urban areas, report the Blethen Maine Newspapers. Filers were also more likely to have lower incomes and larger families.
The number of years it took for filers to catch up with their nonfiling counterparts varied based on the measure, the story reports. More specifically, the study found that filers did not catch up until:
• 12 years for savings.
• 26 years for net worth.
• 14 years for home ownership.
• 26 years for home equity.
• 14 years for total income.
The study relied on data from a National Longitudinal Survey of Youth conducted from 1979 to 2004. The authors were University of Maine law professor Lois Lupica and Ohio State research scientist Jay Zagorsky.
