As New Mexico residents prepare for the holidays and the start of a new year, it is common to reflect on the past year. This practice is widespread, with even the government and courts gathering data on the events of the year – especially in terms of finances.
So, what is the latest information on bankruptcy for this last year?
What are the statistics?
The three most significant statistics regarding bankruptcy from this year include:
- The rate of bankruptcy filings decreased: According to United States Courts, bankruptcy filings overall have decreased by 11.7% as of this year. This includes both personal and business bankruptcies.
- Chapter 13 filings increase: It is interesting to note that while almost all filings by chapter decreased, chapter 13 bankruptcy filings actually increased in 2022. This chapter allows individuals to negotiate with creditors and create a strategic repayment plan to repay debts over time instead of liquidation.
- Medical debt is still a leading cause of filing: Even with filings decreasing, medical debt is the reason behind roughly 62.1% of filings, making it the most common reason for bankruptcy. This rate has increased significantly over the years. As of 2000, medical debt was behind 40% of bankruptcies. This increase – and risk – is concerning for many. Especially since medical issues are often unexpected.
Simply because rates of bankruptcy filings are on the downturn does not mean that financial struggles are as well. If you face unmanageable debt, there are options to seek debt relief. It is often helpful to discuss your concerns or questions with an experienced bankruptcy attorney to determine the best possible way forward as you approach the new year.