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59 September 2024 J O U R N A L linquencies by stage has evolved," Walsh said. "As of the second quarter of 2024, the earliest stage delinquencies—those loans 60 days or less delinquent—accounted for the entire increase from the previous year. Meanwhile, seriously delinquent loans—those loans 90 days or more delinquent or in foreclosure—fell to their lowest levels since 1984 as servicers are helping at-risk homeowners avoid foreclo- sures through loan workout options that can mitigate temporary distress." COMMERCIAL CHAPTER 11 FILINGS SURGED IN JULY C ommercial Chapter 11 bankruptcy filings surged by 40% in July 2024, reaching 510 filings compared to 364 filings in July 2023, according to data from Epiq AACER. Overall commercial filings also saw a significant rise, increas- ing by 17% to 2,335 filings in July 2024 from 2,004 in the same month last year. The total number of U.S. bankrupt- cy filings in July 2024 was 44,427, a 24% increase from the July 2023 total of 35,727. Individual bankruptcy filings contribut- ed significantly to this rise, registering a 25% increase to 42,092 from 33,723 in July 2023. Specifically, Chapter 7 filings rose by 32% to 25,720 from 19,463 last July, while Chapter 13 filings increased by 15% to 16,307 from 14,211. "We continue to see a strong and steady rise in bankruptcy filings across the board, reflecting ongoing financial pressures faced by both businesses and individuals," said Michael Hunter, VP of Epiq AACER. "Based on current trends and economic indicators, I expect bank- ruptcy filing volumes to continue this steady increase throughout the remain- der of 2024 and into 2025." Small business filings under Sub- chapter V of Chapter 11, however, saw a sharp decline, with 171 filings in July 2024, a 45% drop from June's record total of 308. This decrease followed a statutory sunset that Congress could not extend before June 21. The enhanced Subchapter V debt limit, which had been in place since March 2020, reverted from $7.5 million to $3,024,725. Similarly, the Chapter 13 threshold reverted to a two- part test limiting eligibility to a maxi- mum of $465,275 for unsecured debt and $1,395,875 for secured debt. "The reversion of the debt limit narrowed the path for distressed small businesses looking to access the cheaper and more efficient process of Subchapter V to restructure their debts," said Amy Quackenboss, Executive Director of the American Bankruptcy Institute (ABI). "ABI is ready to work with members of Congress to provide them with the data necessary to answer questions they might have regarding the benefits that the higher subchapter V debt limit offers to many struggling small businesses in their efforts to restructure, so that more employees can keep their jobs and investors are afforded a better chance to recover their investments." ABI's Subchapter V Task Force re- leased its Final Report and recommenda- tions to Congress on April 19, advocating for maintaining the eligibility limit of $7.5 million in aggregate noncontingent, liquidated debt for small businesses seeking reorganization under subchap- ter V. ABI is also launching a portal for subchapter V practitioners and experts to share their experiences on how the in- creased debt limit assisted small business restructurings. July's total bankruptcy filings also showed a 10% increase from June's total of 40,276. Individual filings rose by 12% from June's 37,518. In contrast, commercial filings decreased by 15% from June's total of 2,758, and commercial Chapter 11 filings saw a dramatic 48% drop from 989 in June 2024, which included two cases with a large number of related filings. Consumer Chapter 7 filings rose 16% from June's 22,190, while Chapter 13 filings increased by 7% from 15,230 last month. The data underscores the ongoing financial challenges faced by businesses and individuals alike, with bankruptcy filings expected by Epiq to continue rising as economic pressures persist. "We continue to see a strong and steady rise in bankruptcy filings across the board, reflecting ongoing financial pressures faced by both businesses and individuals." —Michael Hunter, VP of Epiq AACER