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Are business bankruptcy filings up?

| Nov 5, 2020 | Bankruptcy |

You may assume that economic issues across the country have forced more businesses to close their doors. However, reports indicate that this hasn’t happened and that bankruptcy on the whole is down.

For instance, the U.S. courts reported that there were 22,482 business bankruptcy filings at the end of June in 2020, when statistics were compiled and compared to 2019. That may sound like a lot, but it is “virtually identical” to the previous year.

That said, the officials did point out that it can take some time for the full impact of an economic downturn to be felt. For example, they noted that the economic recession that started in 2008/2009 did not see the peak number of business bankruptcy filings until 2010.

Often, businesses are able to hold on for a time when things in the economy begin to decline. This could be months or even years, depending on the money they have on hand, the specific reasons for the economic issues and the business model that the company uses. That doesn’t mean that a bankruptcy filing will not be the end result, however, but just that it can take a while to get to that point.

Are you considering your financial options and wondering if bankruptcy is right for you? Remember, it does not always mean that your company has to close. There are ways to restructure debt and set things up so that you can have a plan for long-term success. You just need to know about all of the different options that you have.