Nevada is #1 For Bankruptcy Filings

Normally being number one in something is a good thing, but not today. Two separate reports illustrate the overall effect of the recession on Nevada.

The Administrative Office of the U.S. Courts reported the bankruptcies rose almost 35 percent as of September 30, compared to last year. This puts the number of bankruptcies nationwide at 1.4 million filings. They also reported that Nevada had the highest bankruptcy rate in the country.

Nevada’s bankruptcy rate is about 10.5 cases per 1,000 people, a 64 percent increase compared to last year. This brings the total number of bankruptcies in Nevada to over 27,500 cases. There are no signs of things getting any better soon as the unemployment numbers also came in reporting a rate of 13 percent for Nevada. Much of this is due to the decreased number of tourists which Las Vegas, Nevada’s biggest city, relies on so heavily.

Of the 27,500 bankruptcy cases in Nevada, nearly 97 percent were personal filings and just over 3 percent were business filings. Of the personal filings, 72 percent were Chapter 7 liquidation cases.

However, there is somewhat of a silver lining to this harrowing news. TransUnion.com reported that the percent of people who are 90 days or more delinquent on their credit cards are down in the third quarter at 1.98 percent which is down from 2.44 percent and 2.19 percent in the first and second quarters.

Nevadans are spending less, about $200 compared to the second quarter, and banks are limiting lending. TransUnion.com projects that the delinquency rate will drop in Nevada to just over 1 percent in the fourth quarter even with the holidays.

How to Rebuild Your Credit

The decision to file bankruptcy is not an easy one. Although a bankruptcy can relieve a person from most of their debt, it is often a last resort for many people in this trying economic time. People often worry how a bankruptcy will affect their financial future. All you have to do is take control of your financial future.

Step 1: Watch your credit score.

There are dozens of companies that offer “free” credit scores, as long as you sign up for their expensive service. Even after you get one of their memberships, you only get one report a year. What a lot of people do not know is how to actually get their reports for free. Annual credit report.com allows you to get one report from each bureau a year and you do not have to get them all at once. This means you can get a good idea of what your credit looks like every four months. This is especially important after a bankruptcy to make sure that there are no mistakes such as a creditor reporting late or unpaid payments after you have already filed. Mistakes like these can be detrimental to your credit and need to be fixed as soon as possible. Note that the actual bankruptcy itself will stay on your credit for up to ten years, but you can file a response to as why you had to file for it in the first place.

Step 2: Start to rebuild your credit

Many people believe that they will never qualify for any kind of credit after filing for a bankruptcy. That is completely false; in fact many people find it easier to obtain credit after their bankruptcies have been resolved. You may not qualify to buy a new car right away, but you can get a low limit or secured credit card. Make sure you use your new credit cards responsibly because if you start to slip again, you may get essentially blackballed from ever getting credit again. Good spending habits, like paying off your cards in full every month, will help you raise your score quickly. When you are able to qualify for a new or used car, it may be a good idea to make a small extra payment every so often if not once a month. This will show on your credit as being paid “better than agreed” and can boost your credit score, and will help you pay off the car fast as well. When you are eventually able to qualify for a house again, be sure to stay away from the things that got you into a bankruptcy before such as adjustable rate mortgages, or trying to get financing on a home that you know you cannot afford.

Step 3: Maintain your credit

The rebuilding process will take a long time, two to five years in most cases, but when you have successfully rebuilt your credit make sure you maintain it by practicing all of the good habits you learned to rebuild it in the first place. This means staying on top of your credit by receiving quarterly reports, paying off your credit cards on time and in full, and making the occasional extra payment on your car, house, or anything else that you can. Another tip in maintaining your credit would be to watch for identity theft. Identity theft can destroy your credit and recovering from it is almost worse than a bankruptcy. Most credit card companies offer free services that can alert you of abnormal or unauthorized purchases.

The rebuilding process is not an easy one, but the benefits from having good credit are numerous. Note that if you filed a Chapter 13 bankruptcy, this may take long due to the fact that your case will not be resolved for up to five years versus five months with a Chapter 7 case. However, you do not have to file for bankruptcy to rebuild it, you can apply many of these habits today if you feel that your credit is not where is should be.

How to Rebuild You Credit by Randolph Goldberg is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 United States License.

Casino Creditors Are Getting Impatient With Debt-Ridden Casinos

Casinos struggling with large debts can expect to receive increased pressure from lenders to make tough decisions concerning restructuring. These lenders are anxious to get their money back, which in some cases in excess of $1 million, due to the reduced amount of income that the industry is seeing across the board.

One executive of a casino who just recently came out a Chapter 11 bankruptcy said bankruptcy is a viable way for casinos to get back into the black. Tropicana CEO, Scott Butera said during a workshop at the Global Gaming Expo., “You can have a viable business if you have the appropriate capital structure. Bankruptcy allows you to get a second chance. There’s a huge advantage (in being able to reduce debt).”

The industry is very aware of the current economic state and casino operators are becoming more willing to restructure their debts either through a bankruptcy or with the creditors directly. Casinos are finding it hard to maintain a positive cash flow with the economy the way it is. Las Vegas alone has reported a 10 percent drop in visitors in September compared to last year, and almost a 3 percent drop for the first nine months of 2009. The decrease in traffic has affected the average price of a hotel room, dropping from $143 to $113.

With revenue down across the board, many casinos are finding that a bankruptcy is a very viable option, but it has a downside. Many competitors will see the bankruptcy as a chance to improve its market share by stealing away customers. This is obviously very bad for business, but sometimes is the only logical option for many casinos.

Even gaming regulators are urging troubled casinos to file for bankruptcy as a failed casino is viewed as a sign of weakness for the entire industry.

However, planning ahead could lead to a successful bankruptcy. “Plan your public relations well,” said Butera. Letting the public know that the company as a whole is still stable can keep customers from jumping ship.

 

Casino Creditors Are Getting Impatient With Debt-Ridden Casinos by Randolph Goldberg is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 United States License.

Prive Owner File for Bankruptcy

The owner of Privé night club in Las Vegas filed for Chapter 11 bankruptcy on Thursday. This comes after the club, and its sister club Living Room, has been involved in undergoing investigations by state and local regulators concerning illegal activities at both clubs.

Earlier this year both clubs were forced to shut down temporarily after they had been denied their liquor license due to several code violations.

Judge A. Jay Cristol, who is also presiding over the Fountainbleau Las Vegas bankruptcy, approved a motion that will allow Privé employees to continue to receive wages and benefits.

Among the clubs list of 99 creditors, the largest is ADT Construction Group Inc. of Las Vegas with a claim of $1.6 million followed by Midwest Drywall of Las Vegas with a claim of $844,000. In total, Privé filing estimated it has assets of less than $50,000 and liabilities of up to $10 million.

Privé managers said that they were working over the summer to pay back Planet Hollywood for a fine of $500,000 which had been imposed by the Nevada State Gaming Control Board for illegal activities at Privé and the Living Room clubs including prostitution, and underage drinking.

Washinton Mutual is A Thing of The Past

Earlier this week, Chase Bank replaced the signs and converted the operating systems of valley Washing Mutual branches. This comes after Chase bought WaMu almost a year ago during the financial crisis. This change over is expected to help alleviate the problems Chase customers who moved to Nevada after the buyout had when trying to bank at Washington Mutual.

Chase, which is a subsidiary of JPMorgan Chase, has roughly $2 trillion in assets and operates in more that 60 countries around the world. They received $25 million in TARP funds from the government last year, but was able to repay that amount in June of this year.

Another benefit from the takeover is that Chase will now serve a larger, more diverse customer base than previously by either Chase or WaMu. Chase will now have operations on the entire west coast, as well as Nevada and Arizona.

Bankrupties Up 64 Percent in Nevada

More bad news for Nevadans as the Las Vegas Review Journal released the latest bankruptcy numbers last Thursday. It stated that there were roughly 22,000 bankruptcy filings as over September 30, compared to just under 13,500 for the same time period last year.

Las Vegas has seen about 84 percent of these filings, which are overseen by three of the four Nevada bankruptcy judges.

The Silver State has surpassed Tennessee for bankruptcies per 1,000 residents and Nevada’s bankruptcy rate has also beat the national average, which is up 35.5% versus 65% in Nevada.

Chapter 7 bankruptcies make up most of the filing, followed by Chapter 13. Chapter 7 cases have rose by more than 22% compared to all of last year, and the number of Chapter 13 cases are up by about 500 or so cases.

Good news is that the increase in cases filed are not bogging down the courts.

“The court clerks and the judges are doing a good job of getting the cases in and out,” court trustee Brian D. Shapiro said. “I don’t see any significant problems. Bankruptcy court kind of flows a lot quicker compared to other courts.”

Bankruptcy FAQ Pt. 1

Many people feel overwhelmed when they file or start thinking about filing for bankruptcy. Things tend to get worse when they ask their attorney questions because many of the answers are filled with “if this” and “It depends”. What you need are straight forward answers that actually answer your questions. I’ve come up with a few general questions to start, but if you have any specific questions feel free to ask in the comment section or email me at lisa@randolphgoldberg.com. Within any case, there are uniqueness’s that exist that must be taken into consideration, therefore it is difficult to say these will answer every question, however they should help provide you with more of a general understanding.

Bankruptcy FAQs Pt. 1

1. Do I have to go to court?
   Yes, you will have to appear in court when filing for bankruptcy. The only way this can be avoided is if there are extenuating circumstances such as you are serving in the military overseas, you are in jail, or if you are medically unable to leave the hospital or other care facility. You will have to attend at least one hearing called the Meeting of Creditors.
2. How long does this all take?
   Well this actually does depend on your case and which chapter you are filing. A Chapter 7 usually takes about five to six months once filed as long as there are no problems that would cause your discharge to be denied. With a Chapter 13, which is a repayment plan rather than liquidation like the Chapter 7, you will be making payments for up to five years. After you finish the repayment plan it takes an additional four months to close the case on average. However, based on your unique circumstances and based on the number of bankruptcy cases that the court hearing, the time may increase or decrease.
3. Can I transfer my property to friends or family to keep from losing it?
   No, this is called fraudulent transfer and it cannot be reversed. Many times people will end up transferring property that they would be able to keep anyway. In general this is just a bad idea and there is no turning back once it is done, please make sure that you ask your attorney about the specific setup of ownership on you properties and possessions.
4. How much do I need to owe to file for bankruptcy?
   This is actually no qualifying amount to file for bankruptcy; you don’t even have to be behind in payments to file for a bankruptcy. However, you may have so little debt that a Chapter 7 does not make since and a Chapter 13 would serve your needs better, but if you feel pressured by your financial situation bankruptcy can be your way out.
5. Is all that paperwork really necessary?
   All of the paperwork has a purpose, even though it may not seem like it to you. The information gathered by your attorney, whether via questions or documents, is absolutely vital and needs to be attained. Like with most things, there is an easy way and a hard way and with bankruptcy it is best to make things go as smoothly as possible.

More Bankruptcy FAQs

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The Three Ways to File Bankruptcy

This article could be very helpful to you if you are thinking about filing bankruptcy. It tells about the different ways to file from the most expensive and safest, to the cheapest but most risky. Learn more about how bankruptcy can help you.

“How can you get started with your bankruptcy filing? If you want to declare yourself bankrupt you have to begin the process by filing the official bankruptcy forms. You need to know the different methods on how to file for bankruptcy. Your objective is to get the most inexpensive bankruptcy solution and save on legal fees. This article will give you an introduction to the several ways of declaring bankruptcy.

The Safest Method

This is the least complicated and safest means to file personal bankruptcy — retain a bankruptcy lawyer full-time. The lawyer will help you through the whole process. It is the attorney’s job to evaluate, prepare and file your case. During the creditors meeting your attorney will address all the tough issues that may arise. The only negative in selecting this method is that it costs more. You must find a means on how to filter lawyers in good order for you to get the best possible deal if you want to use this method.

The Hybrid Method

This method is the most adopted technique in filing for bankruptcy. The hybrid method usually works best in filing Chapter 7. The key component here is to employ the services of an attorney or law firm to prepare your documents. You need to pay the service provider with a flat fee. Once they file your case you are on your own. You can save on legal fees because part of the solution is a self-help work. You should look for a bankruptcy preparation service that will also give you a mini seminar on how to handle the do-it-yourself portion as part of the deal.

The Cheapest Method

This method is a full self-help solution or “pro se” filing. You need to educate yourself with the complexness of the bankruptcy procedures. You can download the free bankruptcy forms for Ch 13 or Chapter 7 but it is usually easier to do this method if you buy an up-to-date bankruptcy book or a bankruptcy kit. If you try to ask help from your local court clerks they will say they can not help you. They will not give you advice on how to fill up the forms because that would be considered as “practicing the law” — a task reserved only for local bankruptcy lawyers.

What to Do Next?

Now that you know the different methods of declaring personal bankruptcy, which method are you going to choose? The new bankruptcy law doesn’t require you to have a lawyer, but it is in your best interest to seek the advice of a seasoned bankruptcy attorney. If you choose to declare bankruptcy with out the help of an attorney, you must exhibit a lot of patience and diligence. Keep in mind that when it comes to filing for bankruptcy, you either liquidate your assets or you keep them.

Do you want to know where you can find cheap bankruptcy lawyers? Find out how to declare bankruptcy with fast, easy, and low-cost solutions today.

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Do You Need a Lawyer to File Bankruptcy

Do You Need a Lawyer to File Bankruptcy?