Tuesday, Jul 26, 2016
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Economy

Area bankruptcy filings maintain record pace

Northwest Ohio residents continue to file for bankruptcy at a record pace, new statistics show.

In July, the Toledo office of U.S. Bankruptcy Court received 913 petitions, or 5 per cent more than in the same month a year ago.

"The upward volume filing trend is continuing," said David Fickel, clerk in charge of the office.

With 6,430 petitions received in the first seven months of the year, 2004 is on track to surpass last year's 10,381 filings. Through July 31, filings rose 7 percent over last year's 6,019.

Nearly all of the filings are from individuals - most of them seeking to escape credit card debt, medical bills, and other expenses. Often, according to lawyers, bankruptcies are triggered by events such as a divorce, loss of job, or pay cut caused by reduced overtime.

Chapter 7, as part of which filers are able to shed nearly all debt except for loans secured by major property such as cars, houses, and boats, continues to be the most popular type of filing.

There were 5,798 Chapter 7 petitions in Toledo through July 31 compared with 5,501 at the same time in 2003.

Growing in popularity, however, are Chapter 13 petitions, as part of which individuals negotiate with creditors to repay all or a portion of delinquent bills.

The number of such petitions increased 22 percent in the first seven months of the year to 621 from 508 in 2003, according to Mr. Fickel.

Chapter 11, which is used by businesses to reorganize debts, are rare in northwest Ohio, with just 11 filings through July 31 or four more than during the same period in 2003.

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