Hawaii Bankruptcies Continue Downward Trend Despite Pandemic
Hawaii bankruptcies declined in October for the eighth time in 10 months as state unemployment reached a national high of 15.1% and tourism was in the beginning stage of reopening after a major economic downturn.
There were 125 bankruptcy filings in October, a 22.6% decrease from the 162 during the same period in the previous year, The Honolulu Star-Advertiser reported Wednesday.
Data provided by the U.S. Bankruptcy Court, District of Hawaii, showed bankruptcy filings were down 9.8% to 1,274 for the year through October compared to 1,412 during the same period in 2019.
Chapter 7 liquidation filings, the most common type of bankruptcy, fell 19.8% in October to 93 from 116 in the year-earlier period.
Chapter 13 filings, which allow people with regular income sources to establish installment payment plans to creditors over three to five years, dropped 27.3% to 32 from 44 in the year-earlier period.
There were no Chapter 11 reorganization filings, which are used for business reorganizations, compared with a one filing in the year-earlier period.
Honolulu bankruptcy attorney Blake Goodman said the decrease was unexpected and that he expects a return to normal bankruptcy filing volumes next year after federal and state coronavirus financial assistance ends for individuals and businesses.
“A lot of creditors, a lot of debtors, business landlords — everyone is going to readjust to protect their economic interest,” Goodman said. "I think 2021 is easily going to be the biggest bankruptcy year in the last five. If the vaccine is delayed, it’s just going to continue to increase the economic woes.”
For most people, the coronavirus causes mild or moderate symptoms, such as fever and cough that clear up in two to three weeks. For some — especially older adults and people with existing health problems — it can cause more severe illness, including pneumonia, and death.