According to data provided by Epiq Bankruptcy, a provider of U.S. bankruptcy filing data, new bankruptcy filings were up year over year across Chapters 7, 11, 13 and 15 in January. Epiq Bankruptcy is a division of Epiq, a global technology-enabled services leader to the legal services industry and corporations.
Total commercial filings increased 12% to 1,694 in January over the 1,508 total filings reported in January 2022. Commercial Chapter 11 filings increased 70% to 257 filings from 151 filings recorded one year ago. All subchapter V small business filings increased 49% to 137 in January from the 92 filings registered during the same period last year.
Total U.S. bankruptcy filings in January were 31,087, up 19% from the 26,215 total filings registered in January 2022. The 29,545 overall individual filings were 20% higher in January than the 24,703 individual filings recorded during the same period last year. While still below pre-pandemic levels, individual Chapter 13 filings continued to increase in January, as the 13,702 reported filings were a 32% increase over the January 2022 total of 10,346.
“While month-over-month and year-over-year new filings were up for most chapters, we continue to see a delta between more cases closing in a month than are being opened, making it inconclusive whether we’ve reached a turning point from historic lows in bankruptcy filings,” Gregg Morin, vice president of business development and revenue for Epiq Bankruptcy, said. “In January 2023, 8,786 more total cases closed than opened. The two biggest deltas were Chapter 7s, where 4,419 more cases closed than opened, and Chapter 13s, where 4,315 more cases closed than opened.”
Compared to December, new filings in every chapter except Chapter 12 increased. January’s total filings represented a 5% increase when compared to the 29,640 total filings recorded in December. Total individual filings for January represented a 6% increase from the December 27.911 total; however, total commercial filings decreased 2% from 1,729 in December. Individual Chapter 7 filings increased 2% from 15,471 and individual Chapter 13 filings increased 10% over December’s 12,393. Total Chapter 11 filings registered a 16% increase from the 365 filings reported in December and total Chapter 11 Subchapter V filings increased 9% from the 126 filed in December.
“While still below pre-pandemic totals, bankruptcy filings continue to increase amid growing debt loads due to inflationary pressures and reduced availability of low-cost financing,” Amy Quackenboss, executive director of the American Bankruptcy Institute, said. “Struggling households and businesses on shaky economic footing can look to bankruptcy to provide a solid path toward a financial fresh start.”