Top states for bankruptcy States with the highest per capita filing rates (total filings per 1,000 population) through the first nine months of 2016 were: 1. Tennessee (5.67) 2. Alabama (5.52) 3. Georgia (4.75) 4. Illinois (4.19) 5. Utah (4.17) Source: Epiq Systems, Inc. data compiled for the American Bankruptcy Institute

Falling foreclosures The number of property foreclosures recorded in Hamilton County during the first nine months of the year declined to the lowest level since 2000. Filings from January through September totaled: * 2000 - 410 * 2001 - 429 * 2002 - 586 * 2003 - 582 * 2004 - 588 * 2005 - 599 * 2006 - 685 * 2007 - 766 * 2008 - 925 * 2009 - 1,071 * 2010 - 1,112 * 2011 - 787 * 2012 - 846 * 2013 - 748 * 2014 - 578 * 2015 - 585 * 2016 - 418 Source: Hamilton County Register of Deeds foreclosure filings.

The number of Chattanoogans going broke is the lowest since before the Great Recession, and property foreclosures in Hamilton County this year are at their lowest number since Bill Clinton was president.

While Tennessee still leads the nation in the rate of those filing for bankruptcy protection in federal court, the number of such filings in the Chattanooga division of the Eastern Division of the U.S. Bankruptcy Court fell during fiscal 2016 to the lowest level in a decade. A total of 5,671 people and businesses sought the protection of the bankruptcy court in Chattanooga during the 12-month period ended Sept. 30, down 1.8 percent from the previous year and 33.5 percent below the record reached for local filings in 2009.

Fewer people are filing for bankruptcy to protect their homes since property foreclosures are at a 16-year low. Rising home prices and tighter lending requirements have combined to cut the number of property foreclosures this year in Hamilton County by nearly 29 percent from a year ago.

"Foreclosure activity has been on a steady slide downward over the past six years, finally dropping back below pre-crisis levels in September," said Daren Blomquist, senior vice president at ATTOM Data Solutions, the parent company of the online foreclosure tracking service RealtyTrac. "While we've known that the national foreclosure problem has been dying a long, slow death for quite some time, the final nail in the coffin of the foreclosure crisis" came this year.

Blomquist said banks have worked through the bulk of the legacy foreclosure backlog in most markets. As a result, the inventory of homes on the market has dropped and prices have increased.

The Greater Chattanooga Association of Realtors said the median price of homes sold last month was up by 12.3 percent from a year ago to $169,550.

"When there were a lot of foreclosures out there in the past, there was a lot of inventory and sellers wanting to unload properties at depressed prices, and that tends to keep overall home prices down," said Nathan Waldorf, president of the Greater Chattanooga Association of Realtors. "Right now, we don't have as many foreclosed properties on the market and homes are more apt to sell at, or in some instances even above, the asking price."

Aaron Shipley, a Hixson Realtor with ERA Blue Key Properties who has sold many foreclosed properties, said he is still getting foreclosed homes to sell and he expects that number to continue or even increase as those who overbought or get into financial trouble can't pay their mortgages.

"It's not like it was at the worst of the downturn, but we're still getting foreclosed properties in the pipeline," he said.

But as the unemployment rate has fallen in half over the past six years, more Chattanoogans are better able to pay their bills. As a result, total bankruptcies nationwide were down 6 percent in the first nine months of 2016 from the same period a year ago.

The average nationwide per capita bankruptcy filing rate for the first nine months of 2016 decreased slightly to 2.54 (total filings per 1,000 population). But Tennessee's filing rate for bankruptcies — 5.67 per 100,000 — was the highest of any state and nearly double the nationwide average.

Contact Dave Flessner at dflessner@timesfreepress.com or at 423-757-6340.