Bankruptcy Filings Surge in 2025: What the Numbers Reveal About Economic Stress
A Sharp Rise in Bankruptcy Filings—What’s Driving It?
By Alexander Hernandez, J.D., Professor, and Author of Consumer Bankruptcy Law (Routledge).
According to recent data from Epiq AACER, U.S. bankruptcy filings have surged in 2025, with Chapter 7 cases up 15% and total filings climbing over 10% year-over-year.
- Chapter 7 filings: 249,152 (↑15% from 2024)
- Chapter 13 filings: 149,337 (↑4.3%)
- Total bankruptcy filings: 423,053 (↑10%)
- Individual filings overall: 399,387 (↑11%)
These numbers aren’t just statistics; they’re an urgent financial signal. The rise in consumer debt is being amplified by high-interest credit card debt, while corporate layoffs (often driven by AI and restructuring from tariff pressures) are reducing household income stability. It’s not just a rough patch; it’s the blueprint for financial distress.
Professor’s Insight: What This Means for Consumers
As someone who works in bankruptcy and debt every day, this isn’t just a temporary bump. It’s a sign of how people are struggling with debt. The spike in Chapter 7 filings is especially telling. It means more folks can’t even qualify for Chapter 13 repayment plans, which usually require steady income.
If an asset isn’t protected by a state exemption, the Chapter 7 Trustee is required to sell it to pay your creditors. This means that assets like non-retirement investment accounts, real estate, or vehicles with too much equity could be taken. No one wants to face losing their car or home.
For consumers, this means:
Immediate Impact on Your Wallet: Protection is Critical. The 15% spike in Chapter 7 filings highlights a grim reality: many debtors may have non-exempt assets at risk. This makes asset protection critical. You must know your state’s specific exemption laws to protect property like your homestead equity and vehicles.
Warning: File too soon or too late, and without proper planning, assets may be taken by the trustee.
What’s Next for Bankruptcy.blog?
I’m working on building a comprehensive state-by-state guide resource with interactive court maps that will help you easily find your district court’s information, Trustee directories with filing tips, contact links, and Exemption guides tailored to each state.
Professor Hernandez is an attorney specializing in consumer finance and debt relief. He is the published author of Consumer Bankruptcy Law (Routledge Publishing) and teaches law and finance courses in both English and Spanish for an international university.
Colleges and universities can purchase my bankruptcy law textbook directly from Routledge Publishing. Paralegals and students who are buying single copies can do so via Amazon Books. To access my YouTube channel, click this link. You can also listen to my podcast on Spotify.
You can learn more about filing for bankruptcy and the bankruptcy petition via this link. Information on the bankruptcy court system, contact information for trustees, and your state’s exemptions can be found here. The federal bankruptcy exemptions are listed here. The latest version of the 341 Meeting of the Creditors can be found here.
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Please note that the information on this site does not constitute legal advice and should be considered for informational purposes only.
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