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General information about bankruptcy and debts matters from attorneys for Kansas, Missouri and national bankruptcy cases.

Small Business Bankruptcy Filings Rise Due to Struggle with Higher Costs

With the rising costs of running a business, from raw materials to loans and insurance, has also come the rise in small businesses filing for bankruptcy. Business owners are struggling to reconcile the impacts of inflation while preparing for the potential end of bankruptcy provisions brought on by the COVID-19 pandemic. Subchapter V bankruptcy filings increased by 60% in a year, from 146 filings in April 2023 to 233 in April 2024, according to a report from Law360. Most types of bankruptcy filings are rising, with Chapter 11 filings increasing by 40% year over year and total bankruptcy filings rising by 28%. As inflation and increasing interest rates continue to weigh heavily on consumers and business owners, many are having difficulty meeting their debt obligations and are seeking out options that can ease their financial burdens. “These increases reflect the increased cost and expense pressures both individuals and businesses are…
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Federal Reserve Officials Leave Interest Rates Unchanged

Federal Reserve officials recently left interest rates unchanged and forecast a decrease in borrowing costs by the end of the year as inflation eases. Rates are being held at 5.3%, having remained steady since July 2023. After battling inflation for nearly two years, they are not quite ready to dismiss inflation entirely, and are therefore keeping rates at a higher level in an effort to weigh on inflation. Alongside this decision, policymakers released their quarterly economic estimates, which project that borrowing costs will be at 4.6% by the end of 2024. This suggests that policymakers will still likely make three quarter-point rate cuts this year. A recent New York Times article reported that the goal of these decisions is to ensure that inflation cools down to a normal level without an economic slowdown. With higher interest rates, the goal is to bring price increases under control while also trying to…
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Americans’ Credit Scores Are Falling for the First Time in a Decade

For the first time in nearly a decade, the national average FICO score has decreased, signaling that many Americans are experiencing some level of financial stress during a time of inflation and high interest rates. This drop has occurred despite historically low unemployment rates and as fears of recession fade. In October 2023, FICO released data showing the national average FICO score came in at 717, down from 718 in July. FICO shared that this recent one-point drop was a result of an increase in missed payments and rising debt levels for borrowers. While this average score remains near record high, and is above pre-pandemic levels, this marks the first decrease since October 2013, when scores fell by two points from April. “The effects of high interest rates and persistent inflation may be starting to weigh on consumers, especially those already struggling to manage their finances,” said Can Arkali, FICO’s…
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