Bob Lawless over at Credit Slips has an excellent post today about the nationwide increase in bankruptcy filings. According to data he compiled using the Automated Access to Court Electronic Records (AACER), March saw more than 4,000 filings a day, the largest number of filings since new bankruptcy laws -- ones that made filing more arduous -- went into effect in 2005.Lawless aggregated the data by state, using April 2006 as a point of comparison. April, Lawless says, was the first month that filings returned to a "normal" pattern after the 2005 bankruptcy law instituted changes.
In Minnesota, bankruptcies have risen 138.8 percent since April 2006. The national average increase is 96.3 percent. Minnesota ranks 19th highest out of 90 judicial districts that saw an increase in bankruptcy filings.
To put this into context, the increase in bankruptcy filings corresponds to the increase in the number of foreclosures in most districts. States that have been decimated by foreclosures -- California, Florida, Arizona -- rank in the Top 10 for bankruptcy filings. Minnesota has seen a 63 percent increase in foreclosures since 2007. And 17.1 percent of all mortgages in the Twin Cities are subprime. In that undesirable category, the Twin Cities are right behind Cleveland and Detroit, two cities that have been nearly wiped out by predatory lending.
