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Statistics show personal bankruptcies have been on the rise

On Behalf of | Feb 22, 2024 | Firm News

People facing overwhelming debt in Florida are often at a crossroads, unsure as to what they should do. Advertising campaigns try to sell certain ideas such as debt relief. Many people dealing with debt might immediately dismiss the suggestion that they file for personal bankruptcy due to not fully understanding how it can help them and focusing on misconceptions.

However, it can be the most seamless way to clear debt, retain various properties and restart their financial life. The current economic uncertainty has contributed to a growing number of people filing for bankruptcy.

Personal bankruptcy filings rose substantially in 2023

According to recently released statistics, there was a 16% spike in non-business bankruptcy filings in 2023 when compared to 2022. Overall, there were more than 434,000 filings. In 2022, there were just over 374,200.

Experts believe that this is likely to grow even further as consumers grapple with debt and inflation. This is still significantly lower than the number of bankruptcies from 2010 just after the financial crisis when nearly 1.6 million people filed.

A combination of financial obstacles is believed to have sparked the rise. That includes credit card debt, student loans, increased interest rates and the previously mentioned inflation.

When thinking about filing, it is imperative to know the facts as to which chapter is better for a person’s situation. Chapter 7 is a liquidation bankruptcy and is generally preferable for people who do not have many assets and are dealing with unsecured debt like credit cards and medical bills. Chapter 13 is for people who have a job with a steady income and want to retain certain properties like a home.

Florida debtors can use bankruptcy to help improve their finances

Massive debt is not only stressful financially, but personally and emotionally as well. Frequently, people do not know where to turn and are under the impression that bankruptcy is either a last resort or should not be considered at all.

Once the facts about bankruptcy are understood, people realize that it is a legal and beneficial strategy to get out of debt and move forward without the constant calls, letters and messages from creditors and debt collectors. Before taking that next step, it is wise to know about the process, its benefits and what can be accomplished through a bankruptcy filing.


Kingcade & Garcia | A Miami Law Firm