Phoenix-Area Bankruptcies on Decline

Throughout the state of Arizona, bankruptcy filings decreased almost 8% for the first half of 2011 from those of June 2010. In Phoenix, bankruptcies declined for the months of April, May and June despite continued high unemployment and a continuing slow real-estate market. June 2011 bankruptcy filings represented an 8% decline from June 2010.

 Chapter 7 bankruptcies, which allow consumers to make a fresh new financial start after non-exempt assets are sold to pay creditors, decreased 5% in June from a year ago; they represent 86% of all Phoenix bankruptcies, an increase of 9% from the beginning of 2011.

Chapter 13 bankruptcies accounted for most of the rest. Chapter 13 bankruptcies, which involve court-supervised repayment plans for people who have a regular income, have decreased more rapidly than Chapter 7 filings, falling 24% in June from one year earlier.

In an article from www.azcentral.com by Russ Wiles, the 14,271 individual and business filings during the first half of 2011 saw a decline of more than 7% compared with the first half of 2010, according to the U.S. Bankruptcy Court in Phoenix. The number of bankruptcy cases has been falling since the peak in March 2010. The number of filings has decreased for 13 of the last 15 months.

Although personal debt has somewhat declined in the past months, many Americans are still seeing their bills mounting. In the beginning of July, the American Bankers Association reported slightly higher delinquency rates for the first quarter in five of 11 consumer-loan categories that it tracks, including credit cards.

ABA’s chief economist, James Chessen, states, “’With family incomes already stretched, even small increases in daily living expenses can be enough to derail the ability to meet debt obligations. With a slow-growing economy and weak job growth, there will continue to be financial stress that will make it hard for some people to pay their bills on time.’”

The current decline in bankruptcy filings may be due to fact that many people in the most dire of economic straits have already filed. Also, states one bankruptcy attorney from Mesa, Arizona, “’Most of the people who were going to get fired, already got fired. Other people simply lack the money to pay filing and attorney fees.’”

It is also likely that credit card companies have become somewhat less aggressive in suing consumers for unpaid balances.

According to the ABI’s executive director, Samuel J. Gerdano, “’The drop in bankruptcies for the first half of the year shows the continued efforts of consumers to reduce their household debt and the overall pullback in consumer credit.’”

If you are still facing insurmountable debt despite the slightly strengthening economy, contact the lawyers at Legal Helpers. We are experienced and knowledgeable in the field of all aspects of personal bankruptcy protection. Call us toll-free at 800-260-1402 today for your initial free consultation for more information.

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