Fewer in state going bankrupt
Filings in early 2017 lowest in decade, down 1.5% since 2016
Wisconsin posted its fewest bankruptcy filings in a decade in the first half of 2017, a reflection of an improved economy and the availability of jobs.
The 8,921 bankruptcy petitions filed in federal court in January through June marked the lowest total for that period in the state since 7,642 were filed in 2007, just before the Great Recession.
Filings were down 1.5% from 2016, when 9,060 people or businesses declared themselves insolvent.
The figures in Wisconsin were slightly better than nationally in the first half of the year. Total bankruptcy filings through June increased 0.2% in the United States, to 399,454 from 398,627, during the same period in 2016, according to the American Bankruptcy Institute.
Most of the Wisconsin filings were for Chapter 7 bankruptcy — the type that wipes out debt such as credit card balances, medical bills and overdue utility payments.
The 2017 filings in Wisconsin might have been lower if not for a revival of subprime credit lenders, along with large medical bills that were overwhelming to consumers despite required health insurance, said Milwaukee bankruptcy attorney James Miller, of the firm Miller & Miller.
“It seems like wages and salaries are up, the unemployment rate is down, yet we’re still in this debt problem,” Miller said Tuesday.
Miller said his office is seeing “an uptick in the people with credit card debt.”
“Lenders are starting to lend heavily again in the subprime markets,” Miller said, adding that auto loans with high interest payments also are a growing
issue.
Miller said: “The markets are definitely being more generous to people with bad credit and giving them credit card debt.”
Miller said bankruptcy attorneys thought that with a requirement that Americans carry health insurance, there would be a drop-off in filings that include heavy medical debt.
“People must be ignoring the mandate and not getting coverage because we’re not really seeing a decline in the number of people who are coming in with medical bill problems. Or if they are insured, the coverage isn’t great,” Miller said.