Bankruptcy Filings Surge as Consumer Credit Stress Intensifies
Commercial bankruptcy activity accelerated sharply in April as elevated borrowing costs, mounting consumer credit stress and inflationary pressures continued to weigh on businesses and households across the U.S., according to new data from bankruptcy filing specialist Epiq AACER and the American Bankruptcy Institute.
Commercial Chapter 11 filings climbed 42% year-over-year in April 2026 to 644 cases, up from 454 filings in April 2025. Total commercial filings rose 21% to 3,060 from 2,520 a year earlier, signaling broadening financial distress across multiple sectors of the economy.
Small business restructurings also continued to gain momentum. Subchapter V elections, the streamlined Chapter 11 process designed for small businesses, increased 46% in April to 301 filings from 206 during the same month last year.
“Individual bankruptcy filings are rising due to persistent pressures in consumer credit markets, where auto loan delinquencies remain near 15-year highs,” said Michael Hunter, VP of Epiq AACER. “These trends are further compounded by a 26% surge in foreclosure filings in Q1 2026.”
Hunter added that rising fuel costs and housing-related expenses are further squeezing household finances.
“Higher gas prices are straining consumer goods and household budgets, while continued home appreciation is pushing up property taxes and homeowners’ insurance costs. These headwinds may intensify and drive even more families toward Chapter 7 and Chapter 13 protection in the coming months,” he said.
Total bankruptcy filings reached 56,427 in April, representing a 14% increase from 49,641 filings in April 2025. Individual filings rose 13% year-over-year to 53,367.
Consumer Chapter 7 filings increased 14% to 35,224, while Chapter 13 filings climbed 11% to 18,007. Meanwhile, Chapter 12 filings — designed for family farms and fisheries — surged 130% year-over-year to 62 cases, marking the highest monthly total since February 2020.
“Rising inflation, higher borrowing costs and geopolitical uncertainty are intensifying the financial strain on families and businesses,” said ABI Executive Director Amy Quackenboss. “ABI appreciates the momentum building in Congress to permanently expand access for both distressed small businesses looking to restructure under subchapter V and for consumers looking to file for chapter 13.”
On a month-over-month basis, commercial filings and subchapter V elections were the only categories to increase in April versus March, underscoring continued pressure on business borrowers even as overall filings moderated slightly from the prior month.
