Many more going bankrupt in Mass.

The Boston Globe reports:

Bankruptcy filings have surged 22 percent in Massachusetts this year, as more people are unable to afford their rising mortgage payments or refinance their homes to pay bills, according to court filings and bankruptcy attorneys.

Massachusetts filings in US Bankruptcy Court increased to 2,493 between Jan. 1 and March 5, from 2,039 during the same period a year ago. Filings were also up sharply for all of 2007 compared with the previous year, despite a 2005 law change that was intended to reduce the number of bankruptcies.

Lawyers, trustees, and other bankruptcy specialists said the housing crisis is the single biggest reason that personal bankruptcy filings are rising rapidly. They said homeowners with subprime and adjustable-rate mortgages who cannot make their higher payments are resorting to bankruptcy. A decline in housing values has also limited the financial flexibility of homeowners who once were able to tap their home equity to pay off car loans or mounting credit card bills.

"People can't keep their houses because they can't afford the monthly mortgage payments, they can't refinance because there's no equity in the house, and they don't qualify for a loan," said attorney David Madoff, a US Bankruptcy Court trustee in Boston who oversees some 600 cases a year. "More and more people are coming up in front of me and saying, 'I'm surrendering my house to the bank.' "