ALBUQUERQUE — Bankruptcies in New Mexico increased by more than a third in 2007, but those who work with bankruptcies downplayed the jump.

"There's no drama in the increase," said Norman H. Meyer Jr., clerk of U.S. Bankruptcy Court for the district of New Mexico. "We're still looking for the 'new' normal."

In 2007, 3,402 bankruptcies were filed in New Mexico, an increase of 35 percent from the 2,519 bankruptcies filed the previous year.

But those figures are still a far cry from the 12,424 bankruptcies filed in 2005, an all-time high with virtually of the cases coming in the months before the implementation of the federal Bankruptcy Abuse Prevention and Consumer Protection Act, which went into effect in October.

The 2007 filings remained so low that bankruptcy attorney Ron Holmes of Albuquerque called the 35 percent increase "not all that relevant."

The mortgage crisis appears to have had little impact on bankruptcy filings in 2007.

A Chapter 13 filing gives a consumer the change to avoid foreclosure by making good on a defaulted home loan over five years.

"I'm seeing a lot of clients who come in to do that," said veteran bankruptcy attorney Gerald R. Velarde of Albuquerque.

But Chapter 13 filings are still a small part of the state's bankruptcy picture, accounting for just 11 percent of all bankruptcy filings in the state last year, according to bankruptcy court.

Chapter 7 is the most common form of bankruptcy in New Mexico, accounting for 87 percent of the filings last year.

"We're still seeing the same kind of people we saw before," Meyer said. "They're poor and they've had some kind of disaster."

The typical reasons to file bankruptcy are medical emergency, job loss, divorce, death of a spouse and credit card debt.

But the 2005 bankruptcy act made filing for bankruptcy much more complicated and more expensive than previously. And, people are required to disclose more personal information than under the old law.

A Chapter 7 filing costs $1,000 to $1,500, while a Chapter 13 filing will cost from $2,000 to $4,000.

"I think there are people out there who need to file, who would've filed under the old law, but aren't," Meyer said.

The 2005 act also has led to a steady decrease in the number of attorneys in New Mexico who practice bankruptcy law. Membership in the State Bar of New Mexico's Bankruptcy Section dropped from 152 in 2004 to 120 last year. The group's membership, which is voluntary, rose to 137 for 2008.




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