Here are some grim statistics for the first quarter of 2010. The number of bankruptcy filings in Tampa/Fort Myers division (Polk included) jumped almost 21%. This is mirrored by the eerily similar rise of 21% in bankruptcy cases in the Middle Disctrict of Florida (including Orlando and Jacksonville). In fact, the 16,149 bankruptcy cases filed there gave the Middle District bankruptcy court the unenviable record of being the second busiest bankruptcy court in the country, behind only the Central District of California bankruptcy court.
March 2010 was one of the Middle District bankruptcy court’s busiest month on record. It was third only behind the two months prior to the time when the bankruptcy laws changed with the passing of the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA). The BAPCPA was supposed to deter individuals from filing for bankruptcy, especially Chapter 7 bankruptcy as a means of copping out of their tax debts.
And from the look of things, there seems no evidence of this trend abating anytime soon.
Experienced bankruptcy lawyers predict that the peak in number of bankruptcies will only come in a year or 18 months’ time before the numbers slide. US Bankruptcy Judge Catherine Peek McEwen is handling 6,500 cases in Tampa. The District Chief Judge in Jacksonville had forewarned his judges to anticipate a year of record numbers of bankruptcy filings.
What appears to be affecting consumers in Florida most are the combined effects of the state’s 12.2% unemployment, low housing prices and a huge backlog of foreclosure cases. Although banks are starting to lend again at a ‘modest’ level, the unemployment rate is yet to show a significant drop. Unemployment and bankruptcy both go hand in hand and are usually the last to be overcome in an economic recession. It is not uncommon to find unemployment still rising even after the recession has officially ended. Bankruptcy improvements tend to show even later as it is often a last resort people take for themselves and their businesses.
There has been a wide range of businesses going bankrupt from property developers to retailers. Even professionals and certain franchises have not been spared. Recently, a local Church’s Chicken, several Dunkin’ Donuts franchisees and an Arby’s chain have all filed for bankruptcy.
Of those who file for personal bankruptcies, most have problems with paying for their properties. Banks have been criticized for being reluctant to reduce principal amounts in mortgages and slow in revising mortgage terms to help struggling borrowers.
Filed under Chapter 7 (Tampa) by on Jul 2nd, 2010. Comment. 
Here are some grim statistics for the first quarter of 2010. The number of bankruptcy filings in Tampa/Fort Myers division (Polk included) jumped almost 21%. This is mirrored by the eerily similar rise of 21% in bankruptcy cases in the Middle Disctrict of Florida (including Orlando and Jacksonville). In fact, the 16,149 bankruptcy cases filed there gave the Middle District bankruptcy court the unenviable record of being the second busiest bankruptcy court in the country, behind only the Central District of California bankruptcy court.
March 2010 was one of the Middle District bankruptcy court’s busiest month on record. It was third only behind the two months prior to the time when the bankruptcy laws changed with the passing of the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA). The BAPCPA was supposed to deter individuals from filing for bankruptcy, especially Chapter 7 bankruptcy as a means of copping out of their tax debts.
And from the look of things, there seems no evidence of this trend abating anytime soon.
Experienced bankruptcy lawyers predict that the peak in number of bankruptcies will only come in a year or 18 months’ time before the numbers slide. US Bankruptcy Judge Catherine Peek McEwen is handling 6,500 cases in Tampa. The District Chief Judge in Jacksonville had forewarned his judges to anticipate a year of record numbers of bankruptcy filings.
What appears to be affecting consumers in Florida most are the combined effects of the state’s 12.2% unemployment, low housing prices and a huge backlog of foreclosure cases. Although banks are starting to lend again at a ‘modest’ level, the unemployment rate is yet to show a significant drop. Unemployment and bankruptcy both go hand in hand and are usually the last to be overcome in an economic recession. It is not uncommon to find unemployment still rising even after the recession has officially ended. Bankruptcy improvements tend to show even later as it is often a last resort people take for themselves and their businesses.
There has been a wide range of businesses going bankrupt from property developers to retailers. Even professionals and certain franchises have not been spared. Recently, a local Church’s Chicken, several Dunkin’ Donuts franchisees and an Arby’s chain have all filed for bankruptcy.
Of those who file for personal bankruptcies, most have problems with paying for their properties. Banks have been criticized for being reluctant to reduce principal amounts in mortgages and slow in revising mortgage terms to help struggling borrowers.
Filed under Chapter 7 (Tampa) by on Jun 4th, 2010. Comment.
Pre-foreclosures and bankruptcies in the Tampa area have shot up in the first 3 months of the year in the face of the worst economic recession since the Depression.
The number of foreclosure filings in the Tampa-Saint Petersburg Metro area jumped to 19,284 in the first quarter of this year. This represented a rise of 27% compared to the last quarter and a 17% increase year-on-year. The number of foreclosure filings appears to increase from month to month. For the month of March, total foreclosure filings in the Metro area were 11% higher than February and 7% higher than March 2009.
In a similar fashion, the number of bankruptcy filings in the first 3 months of the year rose by 21% from the last quarter of 2009, representing a record high for the Tampa area.
Other areas of Florida seemed to fare no better. In the middle district of Florida where Orlando, Jacksonville and Tampa are located, there were 16,149 cases of bankruptcy filings out of which 7,810 came from Tampa. This total represented an increase in number of filings by almost 21%, making the Middle District of Florida the second in total bankruptcy cases in the nation, an unenviable record indeed. Only the Central District of California has recorded more bankruptcy filings.
The increase in number of pre-foreclosure notices in the Tampa area has sparked a surge in bankruptcy filings as house owners scramble to get the protection afforded by the bankruptcy law and stave off creditors. The Middle District of Florida experienced a worrying 18% jump in bankruptcy filings in March compared to the same month last year as over 1,500 people sought Chapter 13 bankruptcy protection from the courts. Chapter 13 of the bankruptcy code specifically disallows creditors from taking any further action against bankrupt residents, who are given up to 5 years to pay off their debts under a rescheduled arrangement. It also protects certain assets such that they cannot be liquidated by creditors and helps borrowers avoid paying off home equity loans or second mortgage loans.
The financial malady affects a broad cross section of the community with people from all walks of life, retailers, restaurant owners, home owners, property developers and even professionals seeking bankruptcy protection.
In the whole of Florida, there were 153,540 foreclosure filings in the first quarter of this year, a rise of 7% and 29% from the last quarter and year-on-year respectively. Florida is still experiencing a double digit unemployment rate of 12.3% with 1,138,000 residents without jobs.
Filed under Chapter 7 (Tampa) by on May 29th, 2010. Comment.
There are certain types of debts that you cannot be forgiven of even under bankruptcy, such as child support and tax debt. Another such debt is student loans. When students take on too much debt in the form of student loans to obtain their degree, they may not have the means to repay these loans even when they graduate and start earning a living. The problem is compounded when these loans are taken from private lenders (as opposed to government backed loans).
In today’s world, having a college degree is almost a must if you want to earn a decent salary. But too many people get into huge debts in order to get a degree, and when life’s uncertainties happen such as an illness, economic recession or divorce it makes it difficult for them to continue paying for the loans.
The problem with student loans is that it cannot be easily wiped out by bankruptcy. In order to do so, you have to prove undue hardship, not just an inability to afford the repayments.
Before 2005, only government backed loans were non-dischargeable. The rationale for this is that borrowers who do not repay their loans would affect the national budget. In other words, the American public pays for the borrower’s default, which is unfair. The same goes for loans that come from charitable or non-profit organizations. These organizations give out loans as a means to generate revenue since their core activities do not earn profit. Therefore, such loans should not be easily forgiven. Other categories of student loans such as private student loans were subject to cancellation if you come under bankruptcy protection.
But all of this changed in 2005 when the government put new legislation into effect designed to make it more difficult for people to be declared bankrupt. The new legislation was aimed at preventing people from defaulting on their loans without trying hard enough to repay them. This legislation was called the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA). One aspect of this legislation elevated the status of student loans (including private student loans) to prevent them from being dischargeable.
But elevating the status of private student loans does not make sense. They should be classified the same way as other commercial loans like car loans. But lenders of such loans argue that if private student loans are subject to discharge like other private consumer debts, it would make it harder for students to get such loans. Lenders would be fearful that students would take up a loan and immediately seek bankruptcy protection upon graduation even before they get a proper job. However, most borrowers are not frauds seeking to game the system. Furthermore, there is a means test in every state that determines who can file for bankruptcy.
Although there have been some attempts to change the status of private loans and allow borrowers to be forgiven of the debt in bankruptcy, they have not been successful.
Filed under Chapter 7 (Tampa) by on May 25th, 2010. Comment.
Brown Publishing Co. files for Bankruptcy
Brown Publishing Co. the publisher of Dan’s Papers has filed for Chapter 11 bankruptcy. Dan’s Papers is eastern Long Island’s widest circulating newspaper. The company filed for Chapter 11 April 30 in Central Islip, New York.
According to Brown Publishing Chief Executive Officer Roy Brown, the primary cause of its financial problems is due to declining advertising revenue linked to the real estate market crash. A similar drop in retail advertising also severely impacted its Ohio newspapers. Brown Publishing and 14 associated companies owe $104.6 million as at March 31 and have assets worth $94.1 million.
Dan’s Papers Inc. are the publishers of Dan’s Hampton Style, Montauk Pioneer and The Insider Guide which are magazines targeted at local residents and second-home owners. They feature stories about fashion, performing arts, dining, nightlife and parenting and social commentary produced largely by founder Dan Rattiner. A Dan’s Papers subscription costs $100 a year. But this could easily be afforded by its largely upper middle class to upper class readership whose mean annual income is $381,000. Dan’s Papers has been attracting high-end advertisers to service its readership base.
But the ongoing economic recession has largely changed all that. With declining advertising income and readers and advertisers deserting the print media in favor of web-based alternatives on the Internet, Brown Publishing has fallen into hard times. The company which started operations in 1920 as a family-owned newspaper publisher in Ohio has laid off staff and non-profit making publications and pursued out-of-court restructuring exercises but still could not raise enough funds to meet its financial needs quickly enough.
Court documents show that Brown Publishing’s five major creditors are owed a total of $70.5 million in secured debts with collateral of $94.9 million in book value. The company’s largest unsecured creditors are Abitibi Consolidated Sales, a unit of AbitibiBowater Inc. to whom Brown Publishing owes $296,256, White Birch Paper Co. who are owed $219,150 and Page Cooperative a creditor for $195,680.
Another notable newspaper publisher in the red and seeking bankruptcy protection besides Brown Publishing is Tribune Co. who owns the Chicago Tribune and the Los Angeles Times. Tribune Co. filed for bankruptcy in December 2008.
On the whole, newspaper readership fell 8.7% in the six months through March this year. This comes following a decline of 11% in the six months through September 2009. In addition, income from advertisements fell 24% to $7.68 billion in the fourth quarter of 2009 compared with a year earlier, after an earlier drop of 28% in the third quarter.
Tags: Abitibi Consolidated, Advertising Revenue, Central Islip New York, Chapter 11 Bankruptcy, Chief Executive Officer, Co Files, Consolidated Sales, Economic Recession, Insider Guide, Islip New York, Newspaper Publisher, Ohio Newspapers, Readership Base, Real Estate Market Crash, Retail Advertising, Roy Brown, Social Commentary, Subscription Costs, Unsecured Creditors, Upper Middle Class.
Filed under Chapter 7 (Tampa) by dmishesq on May 27th, 2010. Comment.