Bankruptcy Filings on the Rise – A Review of Recent Bankruptcy Filings Across the United States

Once again there appears to be significant increase in the filing of bankruptcies across the United States. The American Bankruptcy Institute has recently reviewed national filings across the country. 2025 was a remarkably busy year for bankruptcy filings and the most recent data indicates that 2026 is on course to beat the number of filings in 2025.

The latest information released by the ABI indicates that the monthly comparison between July of 2026 to July of 2025 is as follows.

1. The 234 subchapter V elections within Chapter 11 cases represent a 24% increase year over year for July from 2025 to 2026. This section is for small businesses filing Chapter 11’s, in an effort to stay in business and emerge from bankruptcy after restructuring their debt.
2. Total bankruptcy filings for  July 2026 were 54,718, a 10% increase from July 2025 (49,674).
3. There was an 11% increase in individual bankruptcy filings in July of 2026 to 51,925 from 46,639 filed in July of 2025.
4. There were 32,651 individual Chapter 7 bankruptcies filed in July of 2026. That is an increase of 12% from July of 2025 when 29,122 were filed.
5. There was also a 10% increase in the number of Chapter 13 cases filed, where a repayment plan is generally provided by the debtor to repay a portion of the debt to creditors. These cases went up from 17,410 filed in July of 2025 to 19,152 in July of 2026.

With the recent national conversation on the economy, inflation, and the increased costs of living, it is apparent that consumers have extended themselves too far on credit cards. The ABI cited higher target inflation and household levels of debt nationally that are more than eighteen trillion dollars.

My review of this information is consistent with what I have been seeing at my office. The bankruptcy volume continues to increase steadily and has done so since the summer of 2023. Filings through my office steadily  increased through 2024 and   2025. As of this writing in the first week of  August 2026, I have seen an increasing frequency of filing in 2026 which will significantly outpace filings we completed in 2025.

The rise in food and housing has hit hourly wage workers with stagnant wages particularly hard. Can those families make it to the point where interest rates begin to drop and credit card interest rates drop? There is no indication the Federal Reserve will drop interest rates any time soon. The new Chairman, Kevin Warsh, has changed the Board’s policy of providing forward guidance on the direction of interest rates, so it makes it harder to predict the future rate structure. It is my opinion that relief on rates may not be in the near future and  families may need to continue to run up their credit cards to get by, which may force them into a debt workout or filing for some form of bankruptcy protection with the United States Bankruptcy Court.

Based on my experience this period looks eerily reminiscent of the 2008 through 2012 downturn, where individual debt loads  that consumers carried were up and wages did not keep pace which required many people to file for protection with the Bankruptcy Court. Eventually these filings did  work through the system and gave those who had filed a new chance to start fresh through the filing of their petitions and the discharge of debt with the United States Bankruptcy Court.

I would expect that we will see continued filings and the trend will increase throughout the next 12 to 18 months. Hopefully, interest rates can be reduced, alleviating some of the financial strain for some individuals, but  I expect the increase in filings to continue for the foreseeable future.

If you need help considering your options for debt workout or bankruptcy, please feel free to give me a call for a free one-hour consultation.