Loading…
Wednesday, July 23, 2014
Current Weather
Loading Current Weather....
HomeNewsLocal
Published: Friday, 5/2/2003

Area bankruptcies surge on

BY MARY-BETH McLAUGHLIN
BLADE BUSINESS WRITER

Nearly 1,000 bankruptcy cases were filed last month in northwest Ohio, following the first month ever that the local court had more than 1,000 new cases.

The eye-popping numbers are even more staggering when compared with typical monthly figures for the 21 counties covered by the U.S. Bankruptcy Court in Toledo just in the last three years. The 995 cases filed in April were more than twice the filings of the same month three years ago and are three times the figure of another month in 2000.

“I am a little surprised that it hasn't slowed down a little bit, but as long as the economy is down the way it is, it's going to continue at this pace,” said Toledo attorney Stephen Priestap, who handles many bankruptcy cases.

For the first four months of the year, 3,333 cases have been filed locally, up 473 cases or 17 percent from the same period a year ago. The April caseload followed March's 1,014 filings, the first time the court exceeded the 1,000 mark. Until three years ago, the court had not had a month with more than 600 cases, and two years ago was the first time the figures surpassed 800 cases.

The pace this year means another record year is in the offing. Last year's 8,853 cases is the record. This year's total already is equal to a full year's filings as recently as 1995.

Chapter 11 business reorganizations filings have increased this year - to six from four - and the area had its first farm bankruptcy last month. But it's the sharp increases in both Chapter 7 liquidation cases and Chapter 13 individual wage earner repayment cases that are the biggest story, said David Fickel, the court's clerk.

Chapter 7 cases have jumped by 15 percent to 3,045 and Chapter 13 filings have vaulted 30 percent to 281.

“More debtors are electing to attempt repayment plans under Chapter 13 - we now regularly receive 60 to 70 Chapter 13 cases each month,” Mr. Fickel said.

Unfortunately, only about a quarter of those filings will be successful, said Mr. Priestap, who said many filers end up having to convert Chapter 13 into liquidations.

“One of the reasons that Chapter 13 filings are up is because foreclosures have increased,” he explained. “People are trying to save their houses.”

Filers are making tough decisions because of overwhelming debt from job losses, slashed overtime, and loss or reduction of health insurance. Also remaining a problem is over-use of credit cards.



Guidelines: Please keep your comments smart and civil. Don't attack other readers personally, and keep your language decent. If a comment violates these standards or our privacy statement or visitor's agreement, click the "X" in the upper right corner of the comment box to report abuse. To post comments, you must be a Facebook member. To find out more, please visit the FAQ.







Poll