Bankruptcy Filings Up in June, but Columbia Law School Expert Says Trends Remain Favorable

New York, July 6, 2011—Personal bankruptcy filing rates plunged 8 percent nationwide in the first half of the year, with only two states reporting higher numbers for 2011, according to an analysis by Columbia Law School Professor Ronald Mann.

 

On a population-adjusted basis, there were about 3,000 filings per million adults nationwide, or about one in every 330 people. However, Mann, who looked at data compiled by the National Bankruptcy Research Center, emphasized this was an average, and that there were “starkly higher” filing rates in the Southwest and parts of the Southeast.

 

As has been the case since the beginning of 2010, Nevada leads the nation in bankruptcy filings at 6,345 per million, more than twice the national average, followed by Utah (5,057), Georgia (5,022), Tennessee (4,841) and California (4,503).

 

While Nevada has the highest filing rate, its number is down 16 percent compared to 2010. “By comparison, neighboring California’s 2011 filings are almost identical to its 2010 filings and accounted for more than one in six bankruptcy filings nationwide in June,” said Mann, the Albert E. Cinelli Enterprise Professor of Law.

 

Delaware and Utah—each up 10 percent—were the only states in the first half to have filing increases over last year, Mann said.

At the other end of the spectrum, filings for the year are down 29 percent in Vermont, and 20 percent or more in the District of Columbia, West Virginia, and North Dakota.

 

Among large states, the filing rate of 1,424 per million for Texas is noteworthy, Mann said, given that its population far exceeds that of all the low-filing states combined. He added that New York’s rate of 1,645 per million is also “remarkably low.”

 

On a seasonally adjusted basis, the numbers for June are up 10 percent nationwide compared to May, but have decreased 8 percent compared to last year. This is the first month that filing rates have increased in 2011, but Mann said the broader perspective of filing rates “suggests less of a concern.”

 

 

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