Thurston County bankruptcy filings fell sharply in 2012, a sign that the local economy continues to improve, newly compiled data show.
Or is it?
Although total bankruptcy filings in the county fell 14.5 percent, there still were more than 1,000 filings here last year, according to U.S. Bankruptcy Court data for the Western District of Washington. Filings fell to 1,132 last year from 1,324 in 2011.
The decline in filings could be the result of several factors, but not necessarily because people have found jobs, longtime Olympia bankruptcy attorney Jennie Patton said Tuesday.
“I’m not sure it’s truly improving just yet,” Patton said about the economy.
Here are some possible factors that Patton identified:
• Some people facing financial difficulty have decided to walk away from their home, rather than file bankruptcy to try to save it.
• After federal bankruptcy laws were overhauled in 2005, Chapter 7 filers were required to wait eight years before they could file again. That might result in an increase in filings this year.
• Fewer people are able to borrow money because banks have tightened lending criteria.
She also added that people also file for reasons unrelated to the economy, such as divorce and illness.
Of the 1,132 filings last year in the county, 873 were Chapter 7, two were Chapter 11, 1 was Chapter 12 and 256 were Chapter 13.
In 2011, 1,021 were Chapter 7, five were Chapter 11 and 298 were Chapter 13.
A Chapter 7 filing is considered straight bankruptcy, and a Chapter 11 typically is filed by a business to restructure assets and remain in business; Chapter 13 filings can result in a payment plan; and Chapter 12 is reserved for farms.
Bankruptcy filings fell throughout Western Washington in the year-over-year period, the data show.
Total filings fell 13 percent to 22,338 last year from 25,690 in 2011, according to the Western District data.
Thurston County bankruptcy filings in 2012:
• Chapter 7: 873
• Chapter 13: 256
• Chapter 11: 2
• Chapter 12: 1
Thurston County bankruptcy filings in 2011:
• Chapter 7: 1,021
• Chapter 11: 5
• Chapter 13: 298Rolf Boone: 360-754-5403 email@example.com theolympian.com/bizblog @rolf_boone Source: U.S. Bankruptcy Court for the Western District of Washington