Recovery Slow for Arizona's Stressed Economy

April 07, 2011

In spite of the fact that the number of new bankruptcy filings actually fell for several straight months in 2010, the year still resulted in a record number of filings -- nearly 30,000 in all -- in the Phoenix metro area. That is higher than financial industry experts initially forecast and shows that much of Arizona's economy is still in recession mode. The new record is nearly 5,000 filings more than the previous one set back in 2005 (as thousands tried to take advantage of lax bankruptcy rules before sweeping changes took effect in October of that year).

The high number of 2010 filings is proof of Arizona's still-unsteady financial situation. According to a recent survey performed by the Associated Press, continued economic stress is being caused by a seemingly perfect storm of:
- Unemployment
- High foreclosure rates
- Lowered property values
- Loss of high-paying jobs

Ironically enough, the high number of bankruptcy filings is also fueling the continued economic downturn. This vicious cycle is trapping a number of Arizonans in a cycle of nonpayment of expenses, foreclosure and repossession, leading them to bankruptcy as a way to escape from otherwise insurmountable debt. The AP economic stress survey proves that Arizona is still one of the most hard-hit areas of the country financially, following only behind Nevada, California, Florida and Michigan.

There are signs of improvement, however. Credit industry leader TransUnion estimates that the rate of past due amounts on credit cards and mortgages is falling, and that average consumer debt amounts are decreasing. If you are still struggling financially, seek the counsel of an experienced bankruptcy attorney in your area to learn more about your debt management options.

Article provided by Charles M. Sabo, P.C.
Visit us at http://www.charlessabo.com/