South Central Texas saw a surge in Chapter 13 bankruptcy filings in August 2012, compared to the same period one year ago and with July 2012. July saw 164 filings, while August ended with 260 Chapter 13 filings. That is nearly a 59 percent increase. August 2011 had only 191 filings.
There were 383 total bankruptcy filings of all sorts in August 2012, representing an increase of more than 6 percent over the 360 filings in August 2011. The increase between July 2012 and August 2012 was 19 percent, with 321 filings in July as opposed to August's 383.
However, overall, bankruptcy filings are actually down 9.5 percent in South Central Texas. During the first eight months of 2011, some 2,988 cases were filed, but during the first eight months of 2012, only 2,704 bankruptcy cases were filed. This can be attributed to the fact that while Chapter 13 filings have increased, Chapter 7 filings have decreased. August 2011 saw 162 Chapter 7 filings and August 2012 had only 116 filings. There were 153 Chapter 7's filed in July 2012.
While it may seem troubling that more people are filing for Chapter 13 bankruptcy, there is a bit of a silver lining. Folks filing for Chapter 13 must have a source of reliable income and pay back their debts under a special payment plan. Individuals filing for Chapter 7 are in a bit more financial difficulty and are looking to have their debts discharged without any kind of payment plan. This means that while there is still quite a bit of financial trouble out there, more people have jobs and are taking responsible steps toward paying their debt off rather than filing for Chapter 7.