Bankruptcy Filings Still Falling

On a year-over-year basis, the bankruptcy filing rate has been dropping around 12-16%, and last month was no exception. According to the most recent data from Epiq Systems, the daily bankruptcy filing rate in July was 4,622. That represents a 16.1% decline from the same time last year year and a 2.0% decrease from June.

We continue to be on track for just above or below 1.2 million filings for the 2012 calendar year. That will be a 13.9% decline from 2011 (1.38 million filings), which in turn was a 13.6% decline from 2010 (1.56 million filings).

The graph to the right shows the year-over-year changes since July 2008. (Clicking on it will bring up a larger version in a pop-up box.) The huge increases in 2008 were the lingering effects of the BAPCPA, the 2005 changes to the bankruptcy law. The filing rate was still recovering from the huge and artificial rise and then drop in filings around the time of the law's passage. Since November 2010, however, the year-over-year changes have been consistently negative and have been in the -12% to -16% range since May 2011. At what point will these declines stop?