U.S. Bankruptcy Filings Rise 28.9%
Nearly one million individuals and businesses filed bankruptcy in the 12 months ended June 30, according to U.S. Bankruptcy Court data released in late August. There were 967,831 bankruptcy cases filed since July 1, 2007, up 28.9% from the prior 12 months, when cases totaled 751,056.
The largest percentage increase, 60.9%, was in the court system’s ninth district, which includes California, Arizona and Nevada, states where the housing meltdown has been especially severe.
Filings spiked to 276,510 in the three months ended June 30 to the highest level of quarterly filings since late 2006. Of those, 266,767, or 96.5%, were individual filings, and 9,743, or 3.5%, were business filings.
Non-business filings made up 96.5% of the bankruptcies nationwide, totaling 934,009. Of those cases 592,376 were Chapter 7 filings, which involve liquidation of non-protected assets, such as family homes. The total also included 340,852 filings for Chapter 13 protection, which allows individuals to reorganize their finances and pay down their debt.
An additional 780 individuals filed for Chapter 11, which is normally used for businesses, but can apply to individuals who are reorganizing, but have more debt than allowed under Chapter 13.
By region, the highest number of combined filings was in the U.S. Bankruptcy Court’s 6th District, which encompasses Kentucky, Michigan, Ohio and Tennessee. The total came to 167,561, up 21.2% in the last year.