Buy-here, pay-here dealerships might see their potential buyer base grow as summer rolls along, stemming from the jump in bankruptcies filed in July.
According to data provided by Epiq Systems, the American Bankruptcy Institute (ABI) reported this week that total U.S. bankruptcy filings increased 3% year-over-year in July. Total filings came in at 64,283, up from the July 2018 total of 62,241.
ABI also pointed out the 61,025 consumer filings in July represented a 3% increase from the previous year’s consumer total of 59,110.
Officials added July business filings increased 4% to 3,258 from last July’s business total of 3,131. The 417 commercial Chapter 11 filings in July marked a 1% increase over the 413 commercial Chapter 11 filings last July.
“Amid increasing debt loads and growing global challenges, bankruptcy provides financial shelter for distressed consumers and businesses,” ABI executive director Samuel Gerdano said in a news release.
“Congress recently passed legislation that will provide better access to the financial fresh start of bankruptcy for struggling small businesses, veterans and family farmers,” Gerdano continued.
ABI recapped that on Aug. 1 the U.S. Senate passed the Small Business Reorganization Act of 2019 (H.R. 3311), the Honoring American Veterans in Extreme Need Act of 2019 (H.R. 2938) and the Family Farmer Relief Act of 2019 (H.R. 2336) by a voice vote. Officials explained the three bills modernize the bankruptcy code to ensure that “struggling veterans, Main Street businesses and family farmers have access to better tools for achieving a financial fresh start.”
ABI testified in support of the three bills, and the legislation will now proceed to President Trump for signature into law.
Turning back to the latest data, ABI also mentioned July’s total bankruptcy filings rose 5% from last month’s total of 61,079. Consumer filings also climbed 5% from the 58,003 filings in June.
Commercial filings represented a 6% increase over last month’s total of 3,076. However, commercial Chapter 11 filings dropped 2% from the June total of 425.
ABI went on to note the average nationwide per capita bankruptcy filing rate in July was 2.50 (total filings per 1,000 per population), a slight decrease from the filing rate of 2.51 during the first six months of 2019.
Average total filings per day in July were 2,962, a 4% decrease from the 3,072 total daily filings last July.
States with the highest per capita filing rates (total filings per 1,000 population) in July included:
1. Alabama (5.61)
2. Tennessee (5.39)
3. Georgia (4.31)
4. Mississippi (4.25)
5. Nevada (3.79)
ABI has partnered with Epiq Systems, a leading provider of managed technology for the global legal profession, in order to provide the most current bankruptcy filing data for analysts, researchers and members of the news media.