Sunday, May 8, 2011

Phoenix-area bankruptcies drop 8 percent

Metro Phoenix bankruptcies eased for a third straight month, with the filing total in April dropping 8 percent from a year earlier.

The 2,748 filings last month also were down modestly from March 2011, reported the U.S. Bankruptcy Court in Arizona.

The 3,063 Valley bankruptcies in March 2010 now appears to mark the high point of the recent recessionary cycle.

Yet bankruptcy attorneys around the Valley say they remain plenty busy.

Walter E. "Pete" Moak of the Moak Law Firm in Chandler said he continued to see many consumers stressed by mounting credit-card debts. And compared with a year ago, underwater homeowners today have come to the conclusion that their dwellings have depreciated so much that it's not worth filing for bankruptcy protection in an attempt to retain their properties, he said.

Regarding the three-month decrease in filings, Moak said it might mean more debtors are having trouble scraping up the money to hire an attorney.

"It's not an indication their need to file has become less," he said.

Chapter 7 filings, which allow debtors a fresh financial start after non-exempt assets are used to pay creditors, accounted for more than four in five filings last month in metro Phoenix. Chapter 13 debt-reorganization plans made up nearly all the rest.

The statewide total of 3,589 filings in April was down nearly 10 percent from one year earlier.

An improving bankruptcy trend also has become apparent on a national scale, where April filings fell 7 percent from a year earlier and 7 percent from March 2011, reported the American Bankruptcy Institute, relying on data from the National Bankruptcy Research Center.

The ABI's executive director, Samuel Gerdano, predicts a mild filing decline for the year.

"As consumer debt levels fall and families continue to shore up their finances, bankruptcy filings will continue to drop as well," Gerdano said in a statement.

by Russ Wiles The Arizona Republic May. 5, 2011 02:40 PM

Phoenix-area bankruptcies drop 8 percent

Real Estate News

HootSuite - Social Media Dashboard