The number of personal bankruptcy filings dropped 17% in September, as compared to September of 2010. This was news that is easy on the ears after so many months of ominous financial reporting. So, what has changed?
The biggest aspect of change has been in consumer habits. After many months of increases in the number of foreclosures and unemployment rates hitting all time highs, it seems as though Americans have begun to tighten their financial belts.
As the number of bankruptcy filings dropped 4% from August to September of this year, and of those, Chapter 13 filings dominated. This suggests that more people are financially able to repay their debts over time, rather than have debts forgiven through Chapter 7. Whether the strict qualifying standards are weeding out many from Chapter 7, or more people simply want to repay their debts, the end result is promising.
Financial experts are hopeful this trend is indicative of a bigger initiative. Consumers have begun to spend less and focus on personal debt loads. With government involvement in pushing consumers to utilize valuable resources like credit counseling, many consumers have become more educated about their finances. In turn, financial futures have begun to look brighter than they have in years.