By: Gerri Elder
March 15, 2011
Rusty Hyneman - a Memphis real estate developer who once attained notoriety for his extravagant lifestyle and similarly extravagant gift-giving to elected officials - is now on the brink of bankruptcy.
According to the Commercial Appeal, Hyneman and his bankruptcy attorney have filed a motion seeking relief from a $2 million lawsuit filed by Cadence Bank against Hyneman in an effort to collect on a debt from a failed real estate venture. Attached to the motion is a proposed bankruptcy petition that claims Hyneman has $3.7 million in assets and $62.9 million in liabilities, according to the source.
"Virtually every income producing entity in which Hyneman was involved has been discontinued due to foreclosure, judgments and/or franchise tax liabilities," Hyneman's bankruptcy attorney explained.
Approximately half of Hyneman's debt consists of 15 court judgments, arbitration awards and deficiencies following foreclosures. CNN reports that lenders' pursuit of mortgage deficiency - the difference between what the bank gets on the foreclosure sale and what the debtor owes on the mortgage - became more common in recent years due to plummeting home values during the recession.