Bankruptcy cases fell in 2021 after falling in 2020.  Consumers who were over their head in debt and distressed businesses submitted 434,540 bankruptcy filings through September, 2021.  That’s an almost 30% drop from the 612,561 bankruptcy cases filed at the same point in 2020. And even that number was also lower than the 776,674 bankruptcy cases filed in 2019.

Increased government benefits throughout the year — such as third round $1,400 stimulus checks, supplemental jobless benefits and monthly child tax credit payments — were one reason for the drop.  So were eviction moratoriums, including a now-lapsed federal halt on evictions. The year-end report also pointed to “state lockdown orders that decreased personal expenditures.”

“There are many forces that are pushing people to not file bankruptcy right now and definitely throughout 2021,” said Professor Pamela Foohey, a consumer bankruptcy expert teaching at Yeshiva University’s Benjamin N. Cardozo School of Law.  Before bankruptcy, Foohey said it can take people around two years of financial struggle that ends with a crisis like an eviction notice. But it’s unclear when the clock on that struggle might be occurring in the current context, she added.