Nationwide Bankruptcy Filings Drop in September, Analysis by Professor Ronald Mann Shows

New York, Oct. 4, 2011—Personal bankruptcy filings nationwide declined again in September, continuing a steady downward trend of the last several months, according to an analysis by Ronald Mann, Albert E. Cinelli Enterprise Professor of Law and co-director of the Charles E. Gerber Program in Transactional Studies.

 

There were just below 109,000 filings in September, down from about 113,000 in August. The Sept. figure is 17 percent lower than last year’s, filings for the third quarter of this year were down 15 percent  from last year, and filings in the first nine months of this year are down 10 percent from last year.

 

“The steady decline from last year’s torrid rates is continuing,” said Mann, who performed the analysis for the National Bankruptcy Research Center. “Nationwide, about one in every 220 adults filed for bankruptcy, the equivalent of 4,500 filings per million adults.”

 

Reflecting the lingering effects of the economic downturn, Mann determined that the highest filing rates are concentrated in the Southwest and a swathe cutting up from the Southeast. Nevada still has the highest rate by far, more than twice the national filing rate (9,412); Georgia, Utah, and Tennessee follow (in that order), all with more than one and a half time the national average (about 7,400 filings per million adults). At the other end of the spectrum, six (mostly small) jurisdictions this year have filings less than half the national average, including, in ascending order: Washington, D.C., Alaska, South Carolina, Vermont, North Dakota, and Texas.

 

Mann noted the most interesting point in filing trends comes from comparing the adjacent states of Nevada and California. Although Nevada has had the highest filing rate in the country every month since the beginning of 2010, its filings during 2011 have fallen 18 percent this year compared to 2010. By comparison, neighboring California’s 2011 filings are down only 5 percent from its 2010 filings. Its large population makes this important to national trends: in September, for example, more than one in every six bankruptcy filings nationwide was in California. 

 

The result, according to Mann, is that California has steadily risen through the ranks this year so that by mid-year its overall filing rate (6,600 filings/million adults) is almost one and a half times the national average. 

 

“The good news is that California’s filings finally appear to have experienced a break,” said Mann. “Filings in September in California were down 7 percent from August (on a seasonally adjusted basis) and 18 percent from last year.”

 

                                               

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