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FOR IMMEDIATE RELEASE
(703) 739-0800

 

Third Quarter Bankruptcy Filings Drop Another 6.5%
Personal and Business Filings Decline Across the Country

 

December 6, 1999, Alexandria, Va.- The total number of bankruptcies filed between July 1, 1999 and September 30, 1999 dropped from 345,956 to 323,550, a 6.5 percent drop, according to data released by the Administrative Office of the U.S. Courts. 

The number of bankruptcies filed during the 12-month period ending Sept. 30, 1999 totaled 1,354,376, a decrease of 5.7 percent from the previous 12-month period, when filings totaled 1,436,964. 

The statistics are released after the Senate left Washington for the end of the first session of the 106th Congress.  For two weeks in November, the Senate vigorously debated S. 625, the “Bankruptcy Reform Act of 1999,” a bill designed to make it more difficult for debtors to fully discharge debts. The Senate failed to complete action before adjournment. In May, the House passed a similar bill (H.R. 833).

“While bankruptcy filings are still quite high in historical terms, the sustained strong economy and low interest rate have helped many households reduce debt burdens and the need to seek bankruptcy protection from creditors,” said Samuel J. Gerdano, Executive Director of the ABI. 

Personal bankruptcies account for 97.14 percent of the total new cases filed in the last 12-months.  These cases decreased to 1,315,751, in the 12-month period ending Sept. 30, 1999, down 5.3 percent when compared to the same 12-month period in 1998.  Personal filings decreased during the third quarter to 314,564 a 6.2 percent drop from the second quarter of 1999.

The chapter* breakdown of personal filings for the 12-month period ending September 30, 1999 is:  935,792 chapter 7s; 744 chapter 11s and 379,215 chapter 13s. Chapter 7 bankruptcies represent 71.1 percent of all personal bankruptcies during the 12-month period. 

The chapter breakdown of personal filings for the third quarter is: 218,145 chapter 7s; 203 chapter 11s and 96,216 chapter 13s. Chapter 7 bankruptcies represent 69 percent of all personal bankruptcies during the three-month period, dropping from 97 percent last quarter.

Business bankruptcies continued their decline in the 12-month period ending Sept. 30, 1999, consistent with the booming national economy, dropping 18 percent over the last year to 38,625.  Business filings decreased during the third quarter by 13.4 percent to 8,986. 

The chapter breakdown of business filings for the 12-month period ending Sept. 30, 1999 is: 23,499 chapter 7s; 8,238 chapter 11s; 811 chapter 12s and 6,047 chapter 13s.

The chapter breakdown of business filings for the third quarter is: 5,388 chapter 7s; 2,080 chapter 11s; 199 chapter 12s and 1,314 chapter 13s.

Over the past three months, personal filings increased in 17 districts and decreased in 77 districts.

 

Districts with the Highest Percentage Decrease in Filings (Business and Personal)
From October 1, 1998 to September 30, 1999

1.
  Northern District of California  15.4%
2.  District of Minnesota   13.6%
3.  District of New Hampshire  12.3%

4.   Southern District of California  12%
5.  Northern District of Texas  11.5%

Districts with the Highest Percentage Increase in Filings (Business and Personal) 
From October 1, 1998 to September 30, 1999

1.  District of Delaware   46.7%
2. District of Hawaii  3.7%
3.  District of Alaska  3.2%
4.  Eastern District of Washington  3%
5. 
District of Oregon  2.9% 

For statistics on a particular region, historical trends or to talk to a bankruptcy professional in your area, contact ABI Public Affairs Coordinator Sherri Pascale at (703) 739-0800..  Statistics can also be retrieved online at http://www.abiworld.org/stats/newstatsfront.html. 

ABI is the largest multi-disciplinary, non-partisan organization dedicated to research and education on matters of insolvency. ABI is not an advocacy group. Instead, ABI was founded in 1982 to provide Congress, its members, journalists and the public-at-large with an unbiased analysis of bankruptcy issues. ABI’s membership includes nearly 7,000 attorneys, bankers, judges, lenders, professors, turnaround specialists, accountants and other bankruptcy professionals providing a forum of the exchange of ideas and information. For additional information on ABI visit ABI World at http://www.abiworld.org.

 

Definitions from Bankruptcy Overview:  Issues, Law and Policy, by the American Bankruptcy Institute

Chapter 7 of the bankruptcy code is available to both individual and business debtors.  Its purpose is to achieve a fair distribution to creditors of whatever non-exempt property the debtor has to give the individual debtor a fresh start through the discharge in bankruptcy.

Chapter 11 of the Bankruptcy Code is available for both consumer and business debtors.  Its purpose is to rehabilitate a business as a going concern or recognize an individual’s finances through a court-approved reorganization plan. 

Chapter 12 of the Bankruptcy code is designed to give special debt relief to a family farmer with regular income from farming.

Chapter 13 of the Bankruptcy Code is available for an individual with regular income whose debts do not exceed specific amounts, typically used to budget some of the debtor’s future earnings under a plan through which creditors are paid in whole or in part.

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Web posted and Copyright © December 6, 1999, American Bankruptcy Institute.


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