Bankruptcy filings for the year ended March 31, 2003, rose 7.1 percent to reach record levels, according to statistics released by the Administrative Office of the U.S. Courts last week.
As reported in February, the last three months of 2002 saw a slight dip in filings to 395,129 but that trend reversed itself during the first quarter of 2003 when bankruptcy filings increased to 412,968. The high first quarter numbers helped to push the bankruptcy filings for the 12 months ended March 31, 2003, to the all-time highest total number of filings for a 12-month period. In all, there were 1,611,268 bankruptcy filings, up from 1,504,806 for the same time period in 2002.
Most of the filings, 98 percent, were personal. For the year ended March 31, 2003, there were 1,573,720 personal bankruptcies filings, a record for any 12-month period. Business filings for the same time periods declined, falling from 39,845 in 2002, to 37,548 in 2003. While these numbers are above the 35,992 business bankruptcies for the year ended March 31, 2001, they are also well below the 52,638 filed in 1998.
The large number of bankruptcy filings is putting a strain on judicial resources. In March 1992, there were 2,965 filings per judgeship. In March of this year, the number of judges was the same as the 1992 level but with dramatically increased workload, jumping the number of filings per judgeship to 4,973.
Although consumer debt continues to rise and fuel the high number of bankruptcies, there are indications that consumers are becoming more cautious, according to statistics released by the Federal Reserve earlier this month. In 2002, borrowing increased 3.3 percent, a significant drop 6.9 percent in 2001 of 6.9. Borrowing increases for the first quarter of 2003 were 3.7 percent.