Employees of U.S. Bankruptcy courts in North Dakota and northwestern Minnesota worked overtime - literally - to process last-minute filers.
The new federal bankruptcy law kicked in Monday, prompting a flurry of new cases filed in Fargo and Fergus Falls, Minn.
Dianne Schmitz, bankruptcy clerk in Fargo, said federal staffers worked nine hours each on Saturday and Sunday to process new filings.
"It doesn't seem like a Monday because we've been working all weekend," Schmitz said.
The new law puts debtors under more scrutiny, forces them to adhere to a budget developed from IRS standards and enables creditors to recoup some money.
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There were 349 new bankruptcy filings in Fargo on Friday and 161 more combined over the weekend.
In Fergus Falls, clerks experienced a similar crush to process cases before stricter laws make it more difficult and expensive for debtors to file for bankruptcy.
"We had a rush at the end like every other court did," said Delores Campbell, deputy in charge for the court in Fergus Falls.
There were 174 cases filed Friday, 65 on Saturday and 21 on Sunday. "We have never received this large amount of filing in a day or month before," Schmitz said.
The rush to file was expected as new bankruptcy filings began increasing last spring.
"I did not expect it would be this extreme," Schmitz said. "It's been a phenomenal effort by everyone in the office."
This month, Fergus clerks processed 679 new bankruptcy filings. Campbell said there are typically 150 cases in a month.
Year-to-date numbers show a significant jump.
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In Fargo, there were 3,478 cases filed from Jan. 1 to Sunday, compared to 1,818 new filings during the same period in 2004. The filings represent a 91 percent increase.
In Fergus Falls, where the bankruptcy court handles filings for 25 counties, there were 2,075 new cases from Jan. 1 to Sunday.
That's a 70 percent jump compared to the 1,228 cases filed during the same period in 2004.
As of 3:30 p.m. Monday, there were no new cases filed in Fargo and one new case in Fergus Falls.
Under the new law, anyone who earns more than the state median income may not be eligible for Chapter 7 bankruptcy protection. New filers also must pass an eligibility test and receive mandatory credit counseling.
Fargo attorney Pat O'Day blames the last-minute rush on procrastinators. "I think the word was out," he said.
O'Day said he expects few new bankruptcy filings for the next several months, but that it eventually will return to normal as people face mounting credit card and medical bills.
"For somebody in a financial pinch ... looking at these credit cards are a pretty easy alternative," he said.
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Readers can reach Forum reporter Steven P. Wagner at (701) 241-5542
