CREDIT CORNER

 

Consumer Bankruptcy Filings Show First Decline in Four Years

 

-         Credit & Collections World, News  7/28/04

 

The number of consumer bankruptcy filings are down 3% through the first half of 2004 compared to 2003, according to Lundquist Consulting Inc., a provider of bankruptcy statistics and analytics.  The decrease represents the first drop in consumer bankruptcy filings since 2000.

 

          For the first six months of 2004, consumer bankruptcies totaled 801,817, down from 825,792 in 2003.  On an annualized basis, 1 in every 67 households filed bankruptcy.  Chapter 7 consumer filings declined 1.6% in the first half of 2004 and Chapter 13 consumer filings declined 6.2%.

 

          “Hints of economic improvement are seen in various parts of the country.  On a regional basis, the Pacific is driving down the country’s bankruptcy rate, declining 9.3% through the first half of 2004 compared to 2003,” said Chris Lundquist, founder of Lundquist Consulting Inc.

 

          Lundquist Consulting’s statistics showed that the decline in the Pacific was driven by California, which decreased 11.8% in the first half of 2004.  Other regions showing decreases in bankruptcy filing rates include the South at 5.1%, North Central (West) at 2.6% and North Central (East) at 1.7%.  Increases in filings were seen in the South (West) at .5%, Northeast at 1% and the Mountain region at .2%.

 

          Filings grew the fastest in Colorado at 12.4% and Utah led the nation in bankruptcy filing rates with one in every 35 households filing, nearly twice the national rate of one in every 67 households, Lundquist Consulting said.