The number of personal and business bankruptcy liquidations is soaring as empty-pocketed consumers and overleveraged businesses throw up their hands in defeat, according to new court data and industry analysts.

The surge in bankruptcy filings is being led by Chapter 7 liquidations as the chief assets held by both individuals and many businesses—often real estate—have lost their value, and as tightened credit markets have prevented filers from injecting new liquidity into their finances.

The trend is present nationwide. The U.S. topped 1 million bankruptcies in the first nine months for the first time since 2005, and the nation is on pace to eclipse 1.4 million consumer bankruptcies in 2009, according to the American Bankruptcy Institute.

Through September, Chapter 7 liquidations in North Georgia are already 12.5 percent ahead of full-year 2008 figures, according to new data released last week by the U.S. Bankruptcy Court, Northern District of Georgia.

As of the end of September, 23,345 Chapter 7 filings had been made in North Georgia, compared with 20,745 for all of 2008. Comparing the first nine months of last year with this year, filings have mushroomed 56 percent, according to court data.

“I don’t see any indications that would suggest that the bankruptcy rates are going to slow down anytime soon,” said Jack Williams, a Georgia State University law professor and a fellow in the American College of Bankruptcy.

Unemployment continues to climb, lending is largely frozen, and foreclosures in September, though slowing in growth from August, are still well above 2008 levels, said Williams, who also is a consultant with BDO Seidman LLP of New York.

“It’s the big three: too much debt, too little money, and too much house,” he said.

Chapter 7 is also the last resort for individuals when little, in terms of assets, remains, and it is more common for individuals.

Personal debt—including credit cards, car loans, and home notes—remains high, lending has been curtailed, unemployment has surpassed 10 percent in Georgia, and real wages are flat to shrinking, making for a lethal combination.

Bankruptcy filings in general, which include Chapter 7 and reorganizations under Chapters 11 (businesses) and 13 (individuals), are on pace to be the highest since 2005, when filings spiked before laws enacted by Congress to make filing for relief more difficult went into effect in 2006.

“If we measure success by [the number of] filings, the track record is mixed and probably pointing toward failure,” Williams said of laws to reform the bankruptcy code.

Laws enacted to change the code were designed to raise the bar for filing for relief and to reduce the number of bankruptcy cases. But even in a good economy, liquidations and restructurings are common.

“It’s a healthy component in a robust economy,” Williams said.

Williams said elevated bankruptcy levels will likely persist for three to five years, and numbers might not reach their peak for three to four more quarters.