Nevada bankruptcy filings in November were the fewest recorded in the state since February and a sharp decrease from the number filed in October.
But it is too soon, according to a local bankruptcy attorney, to conclude from month’s data that the state has peaked for bankruptcy filings and the economy is starting to improve.
“There is not enough data in a one month sample to give good insight in any of those directions,” local bankruptcy attorney Rob Charles said.
Month-to-month filings decreased 24.1 percent to 2,118 in November from 2,789 filings in October, according to numbers released this week by the U.S. Bankruptcy Court of Nevada. The number was the lowest since 1,674 filings in February.
The year-to-year filings climbed 38.4 percent from last November. Through November, there have been 26,876 bankruptcy filings, 46.2 percent more than the number of filings for all of 2008.
Charles said many key economic problems still remain — such as adjustable rate mortgages or delayed principal loan payments coming due — that could see bankruptcy filings continue on their torrid pace in 2010.
“Data I’ve seen suggests that a number of those will continue to adjust through calendar year 2010,” Charles said. “Those adjustments appear to be related pretty strongly to the bankruptcy filings.”
Chapter 7 liquidations account for the bulk of the filings — 1,563 statewide in November and 19,219 in the first 11 months of the year. Those represent a 45.1 percent increase from last November and 50.9 percent more than filed all of last year.
Chapter 7 cases are filed by individuals, married couples and businesses. Chapter 13 cases, which require court-ordered repayments under three- to five-year plans, are also up this year with 7,257 cases filed through November compared with 5,469 filed in all of 2008.
Chapter 11 filings, in which businesses seek protection while trying to reorganize their debts, have recorded the sharpest increases. There have been 400 Chapter 11 filings this year, 34.7 percent more than all reorganization cases that have been filed in the previous two years combined.
Some of the high-profile Chapter 11 cases that have been filed this year include locals gaming company Station Casinos, developer Jim Rhodes’ real estate companies and the 2,675-acre Park Highlands master plan in North Las Vegas.
The Southern Division of the court in Las Vegas, which is overseen by three of the four Nevada judges, received 1,738 filings in November. The number is a 33.9 percent increase from the 1,298 filed same time last year.
The Southern Division has received 22,604 filings through November, 43.2 percent more than received in all of 2008. Nevada ranked first in the nation the first three quarters of 2009 for the number of bankruptcies filed per capita, and is the state with the fastest rising bankruptcy rate, according to the Automated Access to Court Electronic Records system.
Contact reporter Arnold M. Knightly at email@example.com or 702-477-3893.