By: chris skinner September 25, 2024

Financial Distress: Bankruptcies Up More than 16 Percent Year Over Year

Know the Data: Bankruptcies On the Rise in the Second Half of 2023 and First Half of 2024

Bankruptcy cases are handled in federal court. While you will file for bankruptcy in the jurisdiction in which you reside—such as in the Central District of California if you live in Orange County—your petition is brought in federal court. The reason is that bankruptcy cases are handled by the federal bankruptcy code. They often involve multi-state issues, such as creditors from other jurisdictions. The United States Courts collects comprehensive bankruptcy filings. The most recent data was published on July 31st, 2024. It covers the Q3 and Q4 of 2023 as well as Q1 and Q2 of 2024. Here is what we know about the bankruptcy filing data during this period:

22,060business bankruptcy filings; and
464,553 personal bankruptcy filings.

As noted, that is a 16.2 percent increase in total bankruptcy filings over the same period the previous year. To put that number into perspective, that means that more people filed for personal bankruptcy protection in the United States during this period between the second half of 2019 and the first half of 2020. In other words, bankruptcy filings are at the highest level that they have reached since before the start of the COVID-19 pandemic. There were 284,975 Chapter 7 bankruptcy petitions filed and 192,421 Chapter 13 bankruptcy petitions filed.

What to Do If You Cannot Pay Your Bills in Orange County

Are you one of the growing number of people who are struggling to pay their bills in Orange County? If so, the time to take action is now. As stressful as it can be to confront overwhelming debt, the reality is that the sooner you take action, the better positioned that you will be to get back to stable financial footing. Here are five steps to take if you cannot pay your bills:

Gather All Financial Information: Knowledge is power. You need comprehensive information about your financial situation. Start by collecting all your financial documents. Along with other things, this includes recent bank statements, credit card statements, loan documents, and any other records of debt. Do not forget about your income details—such as pay stubs or profit/loss statements (for self-employed). Comprehensive financial overview is crucial for assessing your options.

Consult With an Orange County Bankruptcy Lawyer: You do not have to figure out financial challenges on your own—especially if you are considering bankruptcy. An Orange County personal bankruptcy lawyer can help. You should schedule a consultation with a bankruptcy lawyer who is well-versed with the bankruptcy courts in California. An Orange County bankruptcy attorney can provide narrowly tailored advice based on your financial situation. Your lawyer will help you understand the legal nuances, your rights as a debtor, and the implications of filing for bankruptcy.

Evaluate Options (Chapter 7, Chapter 13, and Debt Relief Alternative): You have a number of different options to deal with your financial challenges. The best path forward will depend on the specificity of your situation. To start, you should consider the differences between filing for Chapter 7 or Chapter 13 bankruptcy. Chapter 7 is about liquidating your assets to pay off debts, suitable for those with limited income. In contrast, Chapter 13 involves restructuring debts and setting up a repayment plan. Of course, bankruptcy is not the right for every case. Any person dealing with financial struggles in Orange County should also explore alternatives like debt consolidation or debt settlement.

Complete Credit Counseling: In California, you cannot file for personal bankruptcy until you have completed a credit counseling course. The class must be offered by an approved agency. A credit counseling session is designed to educate people about financial management, the bankruptcy process, and how to avoid incurring new debts. Ensure the counseling agency is approved in the Central District of California to be eligible to move forward with a Chapter 7 or Chapter 13 bankruptcy filing in Orange County.

File a Bankruptcy Petition: After completing all preliminary steps and deciding that bankruptcy is the right choice, you will need to file a petition with the bankruptcy court in Orange County. Doing so includes submitting your financial documents and the forms detailing your income, debts, and asset information. Filing officially starts your case and invokes an automatic stay. It will temporarily halt all debt collection efforts by creditors. An Orange County bankruptcy lawyer can help you navigate the process.

How Our Orange County Bankruptcy Lawyer Can Help

Navigating serious financial distress is challenging. Bankruptcy—whether through Chapter 7 or Chapter 13—may ultimately be the best option. It is normal to feel stressed, confused, and overwhelmed by financial challenges that have you and your family on the brink of bankruptcy. Our founder and lead attorney Le’Roy Roberson is committed to helping clients solve financial problems. A brighter financial future is in reach. If you want more information about personal bankruptcy options, our Orange County bankruptcy lawyer provides free, confidential initial strategy sessions.

Get Help From Our Orange County Bankruptcy Attorney Today

At Resolve Law Firm, APC, our Orange County bankruptcy lawyer has the professional experience you can depend on. If you have any questions about the legal process, our team can help. Contact us today for a free, 30 minute initial consultation. Your free case review is always completely confidential and carries zero additional obligations. We provide bankruptcy representation in Orange County, including in Huntington Beach, Irvine, Santa Ana, Anaheim, and Costa Mesa.