Although the number of consumers filing for bankruptcy has risen over the last few years, not all states are equally affected. As economic pressures continue to batter the financial lives of many, residents of some states have been able to make it through unscathed. A new study shows that the number of Texas bankruptcy filings is lower than any other state.
The National Research Center released a report in November of this year that named Texas as having the lowest number of bankruptcy filings per capita. Washington D.C., Alaska, South Carolina, Vermont and North Dakota were close followers of the Texas trend. Leading the national bankruptcy filings per capita is Nevada, California, Tennessee and Utah.
Why the differences? For one, Texas is one of the fastest growing states, making its local economy stronger than other states. Carrying one of the lower costs of living, Texas has become appealing for those who are looking for a better life at an affordable price. Further, the Texas unemployment rate is much lower than the national average, giving many an advantage in the job market.
Also, state bankruptcy exemption laws vary by state. This is especially true in non-judicial foreclosure states, which makes the foreclosure process much easier for lenders. When people are left with few options to protect assets in the midst of a debt crisis, filing for bankruptcy can better protect certain assets, such as a home. Texas is one of the most lenient states when it comes to asset protection in bankruptcy.