When ranking the U.S. ZIP codes tied to the most personal bankruptcies in 2022, three of the top five are located in Shelby County.
And if you just look at Chapter 13 bankruptcy — the type that’s more expensive and much harder to complete — all of the top seven ZIPs are here.
To read more about why so many Shelby County residents file for Chapter 13 bankruptcy, click here.
These neighborhoods are all at least 85% Black, as bankruptcies here are more closely linked to race than to economic characteristics, such as median income, unemployment rate, share of college-educated residents or homeownership rate, according to an MLK50: Justice Through Journalism’s analysis of the 2022 data. This is because Black people face a discriminatory credit system, discriminatory lending and low levels of family wealth, according to Yeshiva University bankruptcy professor Pamela Foohey.
Below are the four local ZIPs tied to the most personal bankruptcy filings per person (which also happen to be the four with the most Chapter 13 filings per person) and a map of bankruptcy filings across the county.
Most personal bankruptcies per capita
ZIP 38127, which includes all of Frayser and Northaven, led the nation in bankruptcy filings in 2022, with 446 filings tied to its residents. That’s 10.9 per 1,000 residents.
The ZIP isn’t bottom five in the county in median income, unemployment rate or homeownership rate. But it is 85% Black.
Orange Mound/Castalia Heights, 38114
The ZIP that encompasses most of Orange Mound, Castalia Heights, Imogene Heights and Alcy-Ball, 38114, had 10.6 bankruptcies per 1,000 residents in 2022.
The ZIP has one of the lowest median incomes in the county, at roughly $28,000, and one of the highest unemployment rates, at about 17%. It’s also one of the Blackest ZIPs in the county, with African Americans making up roughly 93% of its residents.
South Memphis, 38106
South Memphis’ ZIP 38106 had almost exactly 10 bankruptcies per thousand residents — roughly one per hundred. It is the county’s Blackest ZIP, at 96%, and has the highest unemployment rate, at over 20%.
ZIP 38109, which encompasses most of southwestern Memphis, had 9.8 bankruptcy filings per thousand people.
Its homeownership rate is higher than the county’s median, and it’s not one of the county’s very poorest ZIPs. But it is the county’s second Blackest ZIP.
Jacob Steimer is a corps member with Report for America, a national service program that places journalists in local newsrooms. Email him at Jacob.Steimer@mlk50.com
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