Bankruptcy Numbers Soar Despite Recent Economic Boost
Contrary to the country’s improving economy, there were 133,459 bankruptcy petitions file just last month. This number represents a 10% increase from last year, according to data collected from Automated Access to Court Electronic Records (AACER). Average daily filings jumped from 6,673 from 6,646; as well, filings dropped 9% from 146,209 in April. May’s numbers showed the second-highest daily level since 2005.
Mike Bickford, President of Oklahoma-based AACER, said in a recent interview, “just because the economy gets better doesn’t mean that consumers can work off cascading debt problems that surfaced earlier.”
Because so many individuals and businesses search for, and take advantage of, various ways to pay off their debt and avoid filing, bankruptcies tend to peak between six months to a year and a half, after any given economy falls.
From the beginning of the year to just this past May 31st, there were 659,516 bankruptcy filings—a 15% increase from 2009, during the same timeframe. 622,798 filings were consumer-related while 36,718 were business filings. Another 6,048 filings were to reorganize under Chapter 11. In March of this year, there were 159,251 filings (6,924 per business day).
Interestingly enough, 16% of this year’s filings come from California. Seven percent were from Florida while six percent came from Michigan. Nevada, based on per-capita, had the most filings overall. May’s filings were the third highest for a single month since October, 2005 when an overhaul occurred of the US Bankruptcy Code, making it difficult to restructure debt—without creditors’ interference.Post Tags: