Total Bankruptcy Filings Increase 31%, Business Filings Surge 54% in 2008
Total bankruptcy filings in the United States increased 31% in 2008Â over calendar year 2007, according to data released from the Administrative Office of the U.S. Courts (AOUSC). Bankruptcy filings totaled 1,117,771 for the 12-month period ending Dec. 31, 2008, a significant increase over the previous year's total of 850,912. The 2008 filing total marks the first year since the implementation of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA) that bankruptcies have surpassed 1 million.
"Today's numbers confirm what we have reported previously, that bankruptcies are on the rise and will continue to spike upward in 2009," said ABI Executive Director Samuel Gerdano. "We expect filings to reach 1.4 million or even more this year, especially if Congress changes the law to permit homeowners to modify home mortgages via Chapter 13."
Business bankruptcies recorded the sharpest percentage increase as the 43,546 business filings during calendar year 2008 represented a 54% increase in filings from the 28,322 filings made during the 12-month period ending Dec. 31, 2007. The 12-month business filing total for 2008 was the highest since the 44,367 filings recorded for the 1998 calendar year.
The 1,074,225 consumer filings during the 2008 calendar year represented a 31% increase over the 822,590 recorded during the same period in 2007. The 714,389 consumer Chapter 7 filings during the 12-month period ending Dec. 31, 2008, comprised 67% of the total consumer filings for the 2008 calendar year, up from 61% the previous year. The consumer Chapter 7 total for 2008 represented a 43% increase over the 500,613 consumer Chapter 7 filings during 2007.
The 358,947 consumers who filed for Chapter 13 during the 12-month period ending Dec. 31, 2008, comprised 33% of the overall consumer filing total. The consumer Chapter 13 total for 2008 represents a 12% increase over the 321,359 consumer Chapter 13 filings during 2007.
The 301,317 total bankruptcies recorded during the fourth calendar quarter of 2008 (Oct.1â€“Dec. 31, 2008) represent a 31% increase from the 226,413 filings during the same period in 2007. The 2008 fourth calendar quarter filing total was the first time since the implementation of BAPCPA that quarterly filings have eclipsed 300,000. The fourth quarter 2008 filing total also represented a 3% increase over the third quarter (July 1â€“Sept. 30, 2008) total of 292,291.
The 288,416 consumer filings in the fourth quarter of 2008 represent a 32% increase in comparison to the 218,428 consumer filings for the same quarter of 2007. The consumer filing total for the fourth calendar quarter also represented a nearly 3% increase from the third quarter 2008 total of 280,787 consumer filings.
Business filings, which totaled 12,901 for the fourth calendar quarter of 2008, represented a 62% increase from the 7,985 filed in the same three-month period in 2007 (Oct. 1â€“Dec. 31). Business filings also rose over the previous quarter as the fourth calendar quarter represented a 12% increase over the 11,504 business filings reported during the third quarter of 2008 (July 1â€“Sept. 30).
The chapter breakdown of business filings for the three-month period ending Dec. 31, 2008, is 8,872 Chapter 7s, 2,941 Chapter 11s, 90 Chapter 12s and 970 Chapter 13s.
The chapter breakdown of non-business filings for the three-month period ending Dec. 31, 2008, is 193,246 Chapter 7s, 234 Chapter 11s and 94,935 Chapter 13s.
States with the highest per capita filing rate (total filings) for the 12-month period ending Dec. 31, 2008:
Districts with the highest percentage increase in total filings for the 12-month period ending Dec. 31, 2008 (compared to the identical period in 2007):
- Central District ofÂ California: 93.5%
- District of Arizona: 78.9%
- Eastern District ofÂ California: 78.1%
- Southern District ofÂ California: 76.6%
- District of Delaware: 73.9%
Districts with the highest percentage decrease in total filings for the 12-month period ending Dec. 31, 2008 (compared to the identical period in 2007):
- District of the Northern Mariana Islands: -29.4%
- District of the Virgin Islands: -21.7%
- Southern District of the Texas: -6.1%
- Middle District of Louisiana: -3.1%
- Northern District of New York: -2.2%
More information will be available atÂ ABI's Statistics Page.
Source: American Bankruptcy Institute