CLLA Update - Bankruptcy Filings Continue Slow Decline; Close to Bottom?
Monday, November 28, 2016
Posted by: Katherine Herrera
Bankruptcy Filings Continue Slow Decline; Close to Bottom?
Bankruptcy filings for the 12-month period ending Sept. 30, 2016, were the lowest for any 12-month period since December 2007. The September annual bankruptcy filings totaled 805,580, compared with 860,182 cases filed from the previous year.
The rate of decline in bankruptcy filings are pretty steady, but not at the bottom yet. The Federal Reserve’s numbers on household debt are related to bankruptcy filings; as household debt goes up, bankruptcy filings will go up as well. The Administrative Office of the U.S. Courts reported that bankruptcy filings fell by less than 10 percent for the third straight quarter, with filings falling by 6.3 percent for the 12-month period ending Sept. 30, 2016, compared with the previous year.
The AOUSC’s report indicates a slight increase in Chapters 11 and 12. The increase in Chapter 11s is attributable to the oil and gas industry bankruptcy filings. With Chapter 11 cases, all related entities are counted as separate entities for bankruptcy filing purposes.
The majority of bankruptcy filings involve non-business debts. During the 12-month period ending September 30, 2016, non-business bankruptcy filings totaled 781,123, down from 835,197 non-business bankruptcy filings in the previous year. Business filings fell to 24,257, from 24,985 in previous year.
The numbers of bankruptcies filed by Bankruptcy Code chapter for the 12-month period ending Sept. 30, 2016 are as follows:
· Chapter 7 filings totaled 498,367, down from 550,036 in the previous year
· Chapter 11 filings totaled 7,450, an increase from 7,040 in the previous year
· Chapter 12 filings totaled 458, an increase from 383 in the previous year
· Chapter 13 filings totaled 299,150, down from 302,642 in the previous year.
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