Chapter 7 Bankruptcy Filings, September 2009
Chapter 7 bankruptcy filings in the Riverside County Bankruptcy Courthouse for September, according to research done by a leading bankruptcy law firm, continue to trend upward in 2009.
The cities with the most Chapter 7 bankruptcies in Riverside County and San Bernardino County for September did not change from the top-ten in August:
Corona, Fontana, Moreno Valley, Murrieta, Ontario, Rancho Cucamonga, Riverside, San Bernardino, Temecula, and Victorville.
Bankruptcy attorneys in the Inland Empire are also noticing a high number of filings from bankruptcy debtors residing in Chino, Chino Hills, Hemet, Hesperia, and Lake Elsinore.
Chapter 7 Bankruptcy Filings in Riverside & San Bernardino Counties, July 2009
Chapter 7 bankruptcy filings in Riverside County and San Bernardino County for July 2009 were most numerous in the following ten Inland Empire cities:
Corona, Fontana, Hemet, Moreno Valley, Ontario, Rancho Cucamonga, Riverside, San Bernardino, Temecula, and Victorville. Hesperia also had a high number of Chapter 7 bankruptcies filed, as did Murrieta.
Chapter 7 bankruptcy, also known as “fresh start” bankruptcy by bankruptcy attorneys, helps debtors get out from under large amounts of debt by discharging most debts owed to creditors.
Most Chapter 7 Bankruptcy Filing Cities in Inland Empire, June 2009
For bankruptcy attorneys in Riverside and San Bernardino counties, there was no shortage of Chapter 7 bankruptcies to be filed in June, 2009. And for the second month in a row, the top ten cities in the Inland Empire with the most Chapter 7 bankruptcy filings has remained the same.
The ten cities with the most Chapter 7 bankruptcy filings in the Inland Empire for the month of June 2009 were: Corona, Fontana, Moreno Valley, Murrieta, Ontario, Rancho Cucamonga, Riverside, San Bernardino, Temecula, and Victorville. Other Inland Empire cities that also had a high number include: Hemet, Hesperia, Lake Elsinore, and Rialto.
Bankruptcy Protection for Eddie Bauer Holdings, Inc.
From CNN online:
“Eddie Bauer Holdings Inc. filed for Chapter 11 bankruptcy protection Wednesday, citing an inability to pay back debt.
Eddie Bauer (EBHI) emerged from Chapter 11 bankruptcy in 2005 after being spun off from former owner Spiegel Catalog, which itself sought bankruptcy protection in 2003.
Costs from the 2005 reorganization, combined with pressure from the current recession, left the company ‘with no choice but to use this process to reduce the debt load,/ said chief executive Neil Fiske in a prepared statement.’”
Eddie Bauer has 371 stores nationwide. In San Bernardino County, there is an Eddie Bauer store in Rancho Cucamonga at Victoria Gardens. In Riverside County, the Dos Lagos Center in Corona also has an Eddie Bauer store. It seems that no closings are imminent, but if a new buyer takes over, however, it’s unclear what effect that would have on store closings.
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Chapter 11 Bankruptcy Filed By GM
Attention, Riverside and San Bernardino counties, your favorite GM dealership might not be around in a few months. Today, GM filed for Chapter 11 bankruptcy, and is expected to close a number of dealerships over the course of its restructuring, which is estimated to take 2-3 months. GM dealerships in the Inland Empire include those in the cities of: Corona, Hemet, Moreno Valley, Redlands, Riverside, San Bernardino, and Victorville.
From the Los Angeles Times online:
President Obama said that pushing General Motors Corp. into bankruptcy today was a painful but necessary step to revive the legendary automaker, saving thousands of jobs and avoiding another direct hit to the struggling economy.
“‘Working with my auto task force, GM and its stakeholders have produced a viable, achievable plan that will give this iconic American company a chance to rise again,’ Obama said at the White House just hours after the company filed for bankruptcy protection this morning in a Manhattan courtroom…
‘Simply loaning GM more money, instead of taking equity in the company, would have continued to saddle GM with ‘irresponsibly large debt,’ the reason the company is in its current dire position, Obama said.
‘We are acting as reluctant shareholders because that is the only way to help GM to succeed,’ he said. ‘What we are not doing, what I have no interest in doing, is run GM.’”
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Bankruptcy Bill DEFEATED in Senate, 51-45
The bankruptcy “cramdown” legislation that the Obama administration hoped would be a key part of its foreclosure prevention plan was defeated in the Senate on Thursday. Bankruptcy attorneys in Riverside and San Bernardino County had hoped that this bill would pass and provide relief for their bankruptcy clients, especially those underwater on their homes, but will now have to wait indefinitely for legislative help.
From CNN online:
“The Obama administration lost a bid to add a powerful weapon in its fight against foreclosure Thursday, after the Senate voted down a proposal to allow bankruptcy judges to modify mortgages.
The defeat left many housing advocates questioning the effectiveness of the president’s loan modification plan. The so-called cramdown provision, which would allow judges to reduce mortgage principal, would have put pressure on servicers to modify loans before borrowers file for bankruptcy.
The financial industry lobbied hard against the bill, arguing that letting judges change mortgage contracts would add instability to the market and raise interest rates. Senate Republicans and some moderate Democrats were concerned about the bill’s impact and about the growing resentment among homeowners in good standing.
The bill was defeated by a 51-45 vote. The House had passed similar legislation last month.”
Inland Empire Chapter 7 Bankruptcy Filings, February 2009
For bankruptcy attorneys in the Inland Empire, there were no shortage of Chapter 7 bankruptcies that needed to be filed in February, 2009. The amount of Chapter 7 bankruptcy filings in the Riverside Bankruptcy Courthouse in February, which serves both Riverside County and San Bernardino County, totals 1,352 — an increase from January’s 1,120 Chapter 7 filings.
The ten cities with the most Chapter 7 bankruptcy filings in the Inland Empire for the month of February 2009 were: Corona, Fontana, Hemet, Moreno Valley, Murrieta, Ontario, Rancho Cucamonga, Riverside, San Bernardino, and Temecula. Other Inland Empire cities that also had a high number include: Perris and Hesperia.
Congress Set to Vote on Bankruptcy Bill Today
Congress is scheduled to vote today on altering the Bankruptcy code to allow judges to modify mortgages. This vote about a potential change in bankruptcy law has Riverside County and San Bernardino County bankruptcy attorneys and their bankruptcy clients watching attentively. From the McClatchy Tribune Wire Service:
“The U.S. House is expected to vote today on a proposal that would allow judges to modify mortgages of people who file for bankruptcy — and could bring a new wave of filings, local court officials say.
The proposed “cramdown” legislation has been controversial — lenders, for one, have opposed it. But bankruptcy attorneys and credit counselors say it could be a smart solution, helping struggling homeowners and making sure lenders get at least a portion of their money back.
It’s part of a broader $75 billion housing plan, which President Obama’s team outlined Wednesday. The plan features cash incentives for mortgage holders who cut deals with borrowers for new, more affordable terms.
The bankruptcy provision is expected to go to the Senate soon after the House vote, and rules there will make passage more difficult.
Under current laws, bankruptcy judges lack the authority to modify most mortgages. They can approve modifications for credit-card debt and other loans, including second-home mortgages. In Chapter 12 cases, usually filed to save family farms, mortgages can be adjusted to reflect the current value of a debtor’s home and farm, rather than the original loan amount.
The bill would allow bankruptcy judges to alter the terms of a mortgage, a process known to the industry as ‘cramdown,’ if no other options remain for homeowners. Judges could extend the payment period or lower the value of the mortgage on the home to the existing market value.”
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Bankruptcy Bill Delayed By Debate On Loan Modification
Riverside County and San Bernardino County homeowners seeking relief from bankruptcy judges to modify their mortgages for them and save them from foreclosure are holding their breath, as Congress debates who deserves to receive this kind of help from bankruptcy judges. Whether or not a bankruptcy attorney has another tool to help Riverside County residents save their homes from foreclosure hinges on the outcome of this debate. Whether you own a home in Corona or a condo in Rancho Cucamonga, this legislation may affect you.
From Yahoo news:
“A dispute among House Democrats stalled legislation Thursday to let bankruptcy judges reduce the principal and interest rate on mortgages for debt-strapped homeowners.
The measure, backed by President Barack Obama, is the most controversial part of a broader housing package that had been expected to pass the House this week.
It hit a snag after a group of moderates expressed concerns in a closed-door meeting of House Democrats about how the bill would affect homeowners who are still struggling to make their mortgage payments.
The banking industry has lobbied hard against the measure, mounting a successful multimillion-dollar effort last year to kill it.
This year, mortgage industry players who are scrambling to narrow the scope of the measure to reduce its potential cost for banks have won some key concessions. House Democrats agreed to limit the measure to existing loans made before the bill is enacted and to borrowers who can show they tried other ways of modifying their home loans before resorting to bankruptcy, among other changes.
But banks want to go much further, restricting the bill only to subprime or other exotic loans.
Centrist House Democrats who have been working in tandem with the financial services industry to scale back the bill balked at supporting it on Thursday after a news report suggested that Sen. Dick Durbin, D-Ill., the lead sponsor of the bankruptcy measure in the Senate, was willing to limit it only to subprime mortgages. The Senate is expected to take up the legislation within two weeks.”
Legislation on Bankruptcy Judges Modifying Loans Introduced
Riverside County and San Bernardino County bankruptcy attorneys will be able to help save the homes of more of their bankruptcy clients, if the new Bankruptcy Bill introduced in Congress today is passed.
Press Release from the House Financial Services today:
“The House Judiciary Committee and the House Financial Services Committee today released details of the combined housing bill the House may consider this week. The measure will combine the Judiciary Committee provisions to allow bankruptcy judges to modify mortgages on primary residences, and the Financial Services Committee legislation which provides a servicer safe harbor, Hope for Homeowners improvements, FHA changes, and reforms to the FDIC insurance fund. The new bill, H.R. 1106 could be on the floor as early as this week.”
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