Bankruptcy activity across the United States continues to climb, with new data from the Administrative Office of the U.S. Courts showing a 10.6% increase in personal and business filings for the 12-month period ending September 30, 2025. While the total number of filings remains well below historic highs, the steady rise signals continued financial pressure on both consumers and businesses; a trend that professionals across the credit and collection industry are watching closely.
Total filings reached 557,376, up from 504,112 the prior year. Non-business filings accounted for the overwhelming share, rising 10.8% to 533,337, while business filings increased 5.6% to 24,039.
Key Trends
- Filings rising every quarter since mid-2022: After bottoming out at 380,634 filings in June 2022, bankruptcy activity has now increased for nine consecutive quarters.
- Chapter 7 continues to dominate:
- Chapter 7: 344,825 filings
- Chapter 13: 203,118 filings
- Chapter 11: 8,937 filings
- Still far below peak levels: Filings are less than half of the 1.6 million bankruptcies recorded in 2010 and well below pre-pandemic norms.
What’s Driving the Increase: Experts point to a mix of persistent economic pressures — including higher prices, resumed student loan repayments, and tighter lending conditions — that continue to strain household budgets. As Amy Quackenboss of the American Bankruptcy Institute noted, “Persistent economic headwinds…continue to weigh on financially distressed consumers and businesses.”
Large corporate failures have also contributed to the uptick. Several well-known brands collapsed in 2025, including Rite Aid, JoAnn, Hooters, Forever 21, and 23andMe. Business bankruptcies are now nearly double their 2022 lows.
Legal scholars caution that bankruptcy data reflects longer-term financial strain rather than short-term shocks. As University of Michigan professor Belisa Pang noted in a published report, “People wait a long time before filing bankruptcy… bankruptcy reflects things that happened years ago.”
Still, despite the recent increases, today’s bankruptcy levels remain historically moderate. The sector peaked at more than 2 million filings in 2005 and held above 700,000 annually for much of the late 2010s.
Bankruptcies are rising steadily, and show no sign of slowing, but remain below historic norms.
