According to data taken from the National Bankruptcy Research Center and printed in the Wall Street Journal, personal bankruptcy filings hit 1.41 million in 2009, which was a 32% increase since 2008.
Analysts blame job losses and the crumbling housing market. In the past, people who earned $40,000-$80,000 were the ones filing for bankruptcy, but the poor economy has pushed people earning as much as $300,000 annually to file.
The article even highlighted an entrepreneur, who had to file bankruptcy when his contracting business started going down hill. Unfortunately, for business owners whose personal credit is less-than-perfect, securing a credit line via a bank has become extremely difficult in these times.
However, factoring firms are still able to look past a personal bankruptcy because a factor is mainly concerned with the creditworthiness of a business owner’s customers. It’s important for business owners to keep invoice factoring in mind if and when their traditional lenders cut back.
Click here to read the entire WSJ article: Personal Bankruptcy Filing Rise Fast.