WhatsNew:
Dealing With This Economy
December 3, 2011
We have been busy at the firm helping our clients deal with this difficult economy. We have had some success recently filing Chapter 11's for a few individuals with multiple properties. A recent court ruling from the Middle District of Florida eliminated a major challenge to this type of bankruptcy. We have seen a drop in the number of Chapter 7 cases compared to last year but have been advised by the foreclosure attorneys that the next waive of foreclosures in coming soon. We expect to see a corresponding increase in Chapter 7 filings. Let us know if we can help you with your financial issues.
CurrentNews:
American Airlines Files Chapter 11
December 2, 2011
The parent company of American Airlines filed for bankruptcy protection in late November, seeking relief from crushing debt caused by high fuel prices and expensive labor contracts that its competitors shed years ago. For most travelers, though, flights will operate normally and the airline will honor tickets and take reservations. American said its frequent-flier program would be unaffected.
Recent Events:
The Local Bankruptcy Scene
November 28, 2011
In the Southern District of Florida, our firm has seen an increase in the unwillingness of Chapter 7 trustees to forgo the collection of potential funds. In Florida, an individual's exemptions in bankruptcy are guided by reference to state-not federal-law. An individual is entitled to certain exemptions of personal and real property. Generally, if an individual was over their exemption limit, i.e. having certain property not entitled to exemption, trustees would generally forfeit their right as administrator of the bankruptcy estate to sell the non-exempt asset if the asset was of little value or considered "unsellable." However, our firm has observed a recent uptick in the willingness of the trustee to sell non-exempt assets worth little, seemingly because trustees do not want to lose out on the potential collection of funds. Often, the sale generates funds in an amount that does little more than pay for trustee and professional fees. If you are considering filing for bankruptcy protection, it is imperative to consult with a bankruptcy attorney who can explain your options and offer pre-bankruptcy planning to avoid these common pitfalls.
Gary Busey files for bankruptcy protection.
Gary Busey has filed for Chapter 7 bankruptcy,
- Getty Images
Last year, Gary Busey was a contestant on business mogul Donald Trump’s “Celebrity Apprentice.” This year, the actor filed for Chapter 7 bankruptcy. According to papers filed Tuesday with the U.S. Bankruptcy Court in San Fernando Valley, Calif., Busey reported less than $50,000 in assets and between $500,000 and $1 million in debts.
Major Lenders Reach Deal with 49 State Attorneys General and Federal Officials
NEW YORK (CNNMoney) -- A settlement has been reached with the five largest mortgage lenders and 49 states and the federal government over the 'robo-signing' scandal. But even as the $26 billion mortgage settlement helps hundreds of thousands of troubled homeowners, it may bring a wave of new foreclosures.
Many lenders held off on reposessing homes during the negotiations between 49 state attorneys general, and federal officials. That's left a backlog of troubled loans, many of which won't be helped by measures in the settlement. Only about 20% of all home mortgages will qualify to apply for help. That limited group may apply for a principal reduction for their mortgage. Only about 500,000 mortgage modifications of this type are expected.
"The bottom line is that 2012 will see a lot of foreclosures that should have taken place in 2011 and didn't," said Rick Sharga, executive vice president for Carrington Holdings, a real estate finance firm.
Daren Blomquist, vice president of RealtyTrac, online marketer of foreclosed properties, agrees that much of last year's 34% drop in foreclosure filings was likely due to the uncertainty involved in the negotiations. He estimates that new filings will climb from 1.9 million in 2011 to between 2.2 million and 2.5 million this year.
"We think what we saw in 2011 was artificially low foreclosure numbers," he said. He added that banks took longer to file foreclosure notices last year, and longer to finish the foreclosure process.
Hostess Brands files for Bankruptcy Protection
Hostess Brands, the maker of Twinkies, Wonder Bread, Ding Dongs, and my favorite, Ho Hos, has filed Chapter 11 for the second time in less than a decade. Rising labor costs and a more health conscious buying public have caused profits for the 87-year old company to lag. There have been no reported layofs.
Bankruptcy Filings Decrease
Not long ago we commented on the rise in bankruptcy filings in 2010. The latest information from the Administrative Office of the U.S. Courts states that bankruptcy filings for the twelve months ending September 30, 2011 shows a drop of about 2% over the previous twelve months. This appears in part to be due to the drop in foreclosure filings after many of the largest banks were caught up in the robo-signing scandal. The banks were submitting affidavits in support of foreclosure cases which were signed by the thousands with little attention to accuracy. Foreclosures are expected to increase again in 2012.
February 10, 2012
According to www.startfresh.com the final decrease for 2011 over 2010 was 12%. Most monitoring services are predicting an increase in 2012 back to 2010 levels. The U.S. Trustee's Office has requested funding for at least the 2011 levels.
Judge Olson Sanctions more Attorneys
In an opinion entered on November 14, 2011 Judge Olson of the Bankruptcy Court for the Southern District of Florida sanctioned 7 more attorneys, suspending them from the practice of law in the Bankruptcy Court for periods ranging from 30 to 90 days. The sanctions were based on objections to claims in Chapter 13 matters that Judge Olson found to be without factual basis. This follows a number of other similar sanctions handed out by Judge Olson during the past year.The Local Bankruptcy Scene
Trustees Becoming More Inclined to Sell Non-Exempt Assets
In the Southern District of Florida, our firm has seen an increase in the unwillingness of Chapter 7 trustees to forfeit the collection of potential funds. In Florida, an individual's exemptions in bankruptcy are guided by reference to state-not federal-law. An individual is entitled to certain exemptions of personal and real property, among other specific exemptions, as provided by the Florida Constitution.
Generally, if an individual was over their exemption limit, i.e. having certain property not entitled to exemption, trustees would generally forfeit their right as administrator of the bankruptcy estate to sell the non-exempt asset if the asset was of little value or considered "unsellable." However, our firm has observed a recent uptick in the willingness of the trustee to sell non-exempt assets worth little, seemingly because trustees do not want to lose out on the potential collection of funds. Often, the sale generates funds in an amount that does little more than pay for trustee and professional fees. For example, individuals who do not claim their homestead as exempt in bankruptcy may take the risk of the trustee attempting to sell the individual's interest in the home to an "investor," who often later seeks to "rent" the home back to the debtor.
Most trustees are now using NADA Black Book retail value for vehicles. In the recent past most all trustees would accept an appraisal from Carmax or a similar dealership as that value most closely represents what a trustee could obtian for the vehicle. Now they are using the higher retail value causling many debtors to have to pay in order to retain their vehicles.
Individuals considering bankruptcy should not see this as a signal that bankruptcy is not the right choice for them. If you are considering filing for bankruptcy protection, it is imperative to consult with a bankruptcy attorney who can explain your options and offer pre-bankruptcy planning to avoid these common pitfalls.
American Airlines files Chapter 11
The parent company of American Airlines filed for bankruptcy protection in late November, seeking relief from crushing debt caused by high fuel prices and expensive labor contracts that its competitors shed years ago. For most travelers, though, flights will operate normally and the airline will honor tickets and take reservations. American said its frequent-flier program would be unaffected.