Bankruptcy trends are starting to increase, likely due to the rise in foreclosures (commercial and residential) and the restarting of student loan interest (September 1, 2023) and payments for most borrowers (October 1, 2023). The American Bankruptcy Institute Executive Director, Amy Quackenboss notes “More distressed consumers and businesses are turning to the financial lifeline of bankruptcy and while filings are still below levels seen prior to the pandemic, rising interest rates, inflationary pricing, and growing debt loads are contributing to an increase in households and businesses seeking a financial fresh start.”
The below are the trends seen as of 2023 year to date:
- Bankruptcy filings including all chapters totaled 35,716, a 15% increase from the July 2022 total of 30,862
- Commercial chapter 11 filings increased 71 percent to 362 in July 2023 from the 212 filings recorded in July 2022.
- Commercial filings were 1,961, a 21 percent increase in July 2023 compared to the 1,621 filed in July 2022.
- Subchapter V small business elections increased 61 percent to 153 in July 2023 from the 95 filings last July.
- Individual filings increased 16% to 33,755 in July 2023 from the 29,241 filed in July 2022.
