The American Bankruptcy Institute reports that the government’s measures in April appear, for now, to have helped individual citizens avoid bankruptcy. Note, however, the rise in commercial Ch. 11 filings – both year-over-year and month-on-month.
Total U.S. bankruptcy filings in April 2020 decreased 46 percent from the previous year, according to data provided by Epiq Systems, Inc. Bankruptcy filings totaled 38,428 in April 2020, down from the April 2019 total of 71,303. The 36,150 consumer bankruptcy filings in April 2020 were down 47 percent from the April 2019 consumer total of 67,802. Total commercial filings decreased 35 percent in April 2020, as the 2,278 filings were down from the 3,501 commercial filings registered in April 2019. Conversely, total commercial Chapter 11 filings were up 26 percent to 560 in April 2020 from the April 2019 total of 444.
“The extraordinary measures taken by Congress and the Administration to assist individuals and businesses weather the initial economic shock caused by the pandemic have likely staved off bankruptcy filings to date,” said ABI Executive Director Amy Quackenboss. “As financial challenges continue to escalate amid this crisis, bankruptcy is sure to offer a financial safe harbor from the economic storm.”
April’s total bankruptcy filings represented a 39 percent decrease when compared to the 62,866 total filings recorded the previous month. Total noncommercial filings for April also represented a 39 percent decrease from the March 2020 noncommercial filing total of 59,684. The commercial filing total represented a 28 percent decrease from the March 2020 commercial filing total of 3,182. Commercial chapter 11 filings increased 6 percent from the 530 filings in March 2020.
The average nationwide per capita bankruptcy filing rate in April was 2.09 (total filings per 1,000 per population), a decrease from the 2.29 filing rate during the first three months of the year. Average total filings per day in April 2020 were 3,239, a 3 percent decrease from the 3,323 total daily filings in April 2019. States with the highest per capita filing rates (total filings per 1,000 population) in April 2020 were:
1. Alabama (5.02)
2. Tennessee (4.44)
3. Mississippi (3.99)
4. Georgia (3.78)
5. Delaware (3.52)
If you have questions, please contact us
If you have any questions or if you would like to discuss the matter further, please contact me, Joel Glucksman, or the Scarinci Hollenbeck attorney with whom you work, at 201-896-4100.
