Ilyce Glink's Blog

Welcome to Ilyce Glink's blog! Here you'll find Ilyce's latest insights on personal finance advice, real estate advice and consumer issues. Come back often for timely and interesting posts on a wide variety of topics.

More Than 100,000 Consumer Bankruptcies Filed in October

Labels: ABI, Bankruptcy, consumers

posted by Melanie G. Rogers at 9:31 AM 0 comments

Consumer Bankruptcies Rise Nearly 30 Percent

The number of consumer bankruptcies filed in September rose 28.6 percent compared with a a year ago, according to the American Bankruptcy Institute. More than 88,000 consumer bankruptcy filings were made in September. ABI says the number declined 8 percent from August. The percentage of Chapter 13 cases, where consumers can often work out terms to keep their homes, was 33.5 percent for September.

"The continued rise in personal bankruptcies reflects high consumer debt, made worse by energy costs and the weak housing market, trapping many households in homes they can neither afford or sell," said ABI Executive Director Samuel J. Gerdano. "We expect consumer bankruptcies to exceed 1.1 million new cases by year end."

Labels: Bankruptcy, consumers

posted by Melanie G. Rogers at 9:45 AM 1 comments

Consumer Bankruptcy Filings Rise By Nearly 30 Percent

During the first half of 2008, ending June 30, the number of consumer bankruptcies filed rose by 28.8 percent compared with the first half of 2007, reports the American Bankruptcy Institute.

There were 503,749 consumer bankruptcies filed in first half 2008; in first half 2007 there were 391,105 consumer bankruptcies filed.

"The continued rise in bankruptcies to their highest levels since Congress changed the law points to the growing strain on family budgets," said ABI Executive Director Samuel J. Gerdano. "We expect this trend to continue through the end of the year, with cases surging past 1 million by year end."

More consumers filed for Chapter 7 protection (liquidation and discharge of unsecured debt such as credit card debt) as opposed to Chapter 13 protection, which may enable the filer to keep his or her home.

Business bankruptcy filings increased by 42 percent during the same time period.

If you're weighing bankruptcy as an option you may first want to contact a credit counselor: http://www.nfcc.org/

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Labels: Bankruptcy, consumers, credit cards

posted by Melanie G. Rogers at 10:59 AM 0 comments

Consumer Bankruptcy Filings Increase by 48 Percent in One Year

While in grad school, I covered the bankruptcy beat for about six months. It was during the time when there was excess liquidity, or cash, in most markets - the stock market, real estate market and so on. And many of the bankruptcy professionals I talked to said that their business improves when the economy declines. Many of them seemed to be really available for interviews. So I imagine now they're starting to get really busy.

Anyway, consumer bankruptcies rose 48 percent in July from a year earlier. They were up nearly 14 percent from June of this year, according to the American Bankruptcy Institute. In July, 94,124 consumer bankruptcies were filed. Many (32.5 percent) of them were Chapter 13 filings, which allows the consumer to work out a payment plan and often keep his or her home.

"The most recent uptick in bankruptcy filings reflects growing stress on the household finances of U.S. families," said ABI Executive Director Samuel J. Gerdano. "We expect bankruptcies to continue to surge past 1 million new cases by year end."

Labels: Bankruptcy, consumers, debtors, debts

posted by Melanie G. Rogers at 3:00 PM 1 comments

More Americans File For Bankruptcy in First Half of 2008

Labels: Bankruptcy, creditors, debtors, Economy, Student Loans

posted by Melanie G. Rogers at 10:58 AM 0 comments

Should You File Bankruptcy When You're $7,000 in Debt?

I received a call during my radio show yesterday from an older gentleman who wanted to know if he should allow the local sherriff to serve him or not. He is approximately $7,000 in debt, but he knows he is being served on part of that debt, around $4,000.

"I could avoid the server," he suggested.

"I don't think that's been working out all that well for you so far," I responded.

He wanted to know about filing for bankruptcy. I suggested that he first have a session with Consumer Credit Counseling Services. The CCCS of Greater Atlanta (he is located in Atlanta) is one of only 9 bankruptcy counseling organizations accredited by the US Bankruptcy Courts. It seems to me that while he might get served (and would have to answer that), bankruptcy isn't the answer when you have a relatively small debt.

Here's more information I received last night from another listener, a bankruptcy attorney:

Dated: 6/22/2008

Ilyce, I didn't have time to call in today, but I wanted to comment on one call. The gentlemen asking about law suit on debts and bankruptcy.

I am a bankruptcy attorney in Atlanta. I do my own consultations and hearings so I deal with 20 to 25 people a week like this guy. You said correctly to try CCCS if possible. On a $4000 debt, they may be able to work out a payment plan for him opposed to filing bankruptcy.

The other tactic I take in State Court if they can afford it is to file an answer in the case and then see if I can settle it before it gets to the judgment stage. I recomend that people do not do this pro se (without an attorney) if they can avoid it. The collection attorneys have it down on how to railroad these through on pro se defendant by summary judgment.

Usually you can settle these debts for .15 to .30 on the dollar if they have some funds available. The Debt Collectors are out of control. The are running over FDCPA without a thought. People who I talk to are getting called twenty to thirty times a day without regard to any provisions of the FDCPA. They are calling their neighbors and family members. It is driving an incredible number of people to me for bankruptcy protection just to get away from the calling and threats.

If you're looking for CCCS of Greater Atlanta (and they're one of the best of a very good bunch of credit counselors), find them online at www.cccsatl.org.

Labels: Bankruptcy, CCCS, debts

posted by Ilyce Glink at 10:10 AM 0 comments

ATA Airlines Cancels Flights, Files for Bankruptcy

Labels: airlines, Aloha, ATA, Bankruptcy, United

posted by Ilyce Glink at 11:41 AM 0 comments

Mortgage Debt Tax Reduction Bill Will Help Few Americans

Last Friday, the House passed a bill which will reduce the amount of tax due on mortgage debt forgiven during foreclosure or while in bankruptcy. Currently, taxpayers must pay tax on this amount as it is considered income. It's really "phantom income:" income that's taxable but not spendable.
The bill, H.R. 3648, is currently a permanent measure but the White House wants to limit it to three years, according to the Washington Post.
What does this mean to the average taxpayer? Not much. According to RealtyTrac, almost 500,000 foreclosures were filed in the first quarter of 2007. Even if the same number filed each quarter this year, we're looking at 2 million foreclosures out of 75 million households, per the U.S. Census.
Still, families that filed for bankruptcy in 2007 or went through foreclosure will be grateful for the tax break.

Melanie G. Rogers, ThinkGlink.com Staff Writer

Labels: Bankruptcy, Foreclosure, Tax

posted by Ilyce Glink at 1:07 PM 0 comments

Countrywide Falling?

Labels: Bankruptcy, Countrywide, Mortgage

posted by Ilyce Glink at 6:35 AM 0 comments

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