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Bankruptcy Filings Are down – But That Doesn’t Mean People Do Not Need to File

Reuters reported today that the number of U.S. businesses and consumers filing for bankruptcy fell 14 percent in the first half of 2012 and could end the year at the lowest level since before the 2008 financial crisis, according to data released by Epiq Systems.

New bankruptcy filings fell to 632,130 in the first six months of the year compared to the same period last year, according to Epiq Systems Inc, which manages documents and claims for companies in bankruptcy.

The number of businesses filing for bankruptcy dropped 22 percent to 30,946 and the number of consumers seeking court protection from creditors fell 13 percent to 601,184.

“We are on pace for perhaps the lowest total new bankruptcies since before the financial crisis in 2008,” said Samuel Gerdano, executive director of the American Bankruptcy Institute, which jointly released the report with Epiq. Gerdano attributed the decline to low interest rates, which have been kept at rock-bottom levels since the financial crisis by the U.S. Federal Reserve.

Despite the drop in filings, there remain many individuals and families that continue to struggle with the consequences of the recession. If you believe that you are in this group, ask yourself the following question:

“Does my/our total credit card and other unsecured debt (such as medical bills etc.) total more than 50% of my/our annual salary?”

If you answered YES, you may need to consider bankruptcy to regain your financial health. Initial consultations with my firm are always free – the advice could be priceless. Bankruptcy lawyers don’t bite. We are here to help…

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