DECEMBER 2004

Bankruptcy Filings Down Through Third Quarter

The Administrative Office of the U.S. Courts (AOUSC) just released its latest statistics on personal bankruptcies in the United States. The total number of personal (non-business) bankruptcies filed for the 12-month period ending September 30, 2004 was 1,584,170, down 2.6 percent from the same period ending one year earlier. Even more encouraging was that total filings for the most recent quarter of the 12-month period (i.e., July through September of 2004) were down nearly 4 percent from the same quarter a year earlier. The improving economy seems to have moderated household financial stress, even if only a little.

The press release from the AOUSC noted that although bankruptcies are down from last year, they remain above the 1.5 million record first set in 2002. One statistic cited by the AOUSC is particularly disturbing in light of Congressional failure thus far to pass bankruptcy reform legislation. "Despite the high caseload, no new bankruptcy judgeships have been created since 1992, when bankruptcy filings for the fiscal year totaled 977, 478."

During the 12 months ending September 30, 2004, Chapter 7 bankruptcies comprised 71.6 percent of personal filings, a proportion virtually unchanged for more than a decade. Out of 91 bankruptcy judicial districts in the U.S. and Puerto Rico, 56 experienced year-over-year declines in filing volume during the period. The table below provides detailed statistics on the number of filings and growth rates by judicial district. The accompanying chart displays the year-over-year rate of change in personal bankruptcy filing rates, by quarter.

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