Personal Bankruptcies in State Are Receding

This year’s earlier wave of personal bankruptcies appears to be receding in California, the result of a robust economy and growth in the employment sector, a public records information service reported.

A total of 16,432 California residents filed for bankruptcy in August. That was down 5.2% from 17,329 for July and up 12.7% from 14,585 for August 1996, according to Santa Ana-based CDB Infotek.

Last month’s number was down 11.4% from April’s all-time high of 18,552. August’s 12.7% year-over-year increase was the lowest since March 1995, when filings rose 12% to 11,464.

“Behind the year’s earlier surge in bankruptcy activity there was a lot of residual distress from the recession. It now appears that California’s economic growth has worked its way into most of the economic sectors that were in trouble. More people are making enough money to meet their obligations,” said Rick Rozar, CDB president and chief executive.

1997 will still be a record year for bankruptcies, CDB reported. So far this year, 136,539 California residents have filed for bankruptcy, up 24.3% from 109,863 for the same eight-month period last year. The state’s trends mirror those nationwide.

The relative decline of the last four months parallels earlier increases, with the Central Valley experiencing a steeper drop-off than the Bay Area.

Relative to population, residents of Riverside and San Bernardino counties are most likely to file for bankruptcy, and Marin County residents are least likely.

CDB Infotek provides online access to public records nationwide. In addition to bankruptcy information, the company provides access to other court records, real estate records, new-business filings and more. The numbers include Chapter 7 and Chapter 13 filings, the vast majority of which are personal.

Chapter 11 filings totaled 127 in August, down 22.6% from 164 the month before, and down 9.3% from 140 for August last year, CDB reported.