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Wednesday, December 31st, 2008

Latest Fashion Trend for 2009: Bankruptcy

According to the Chicago Sun-Times, several retail analysts are predicting that up to 73,000 retail locations will close during the first quarter of 2009 and 20-40% of retail chains could go totally out of business next year.

Ann Taylor, Sears and Talbots are just some examples of the retailers that may be heading toward filing bankruptcy in early 2009, according to the Washington Times.

To struggling retailers, there's little hope that sales will improve as quickly as they need them to--consumers are still very hesitant to swipe that credit card or pull out that cash.

For now, though, consumers who want to spend can take advantage of the stores' massive [and seemingly desperate] blowout sales.

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Posted in Bankruptcy and the Economy | 1 Comment »

Tuesday, December 30th, 2008

5 Steps to Lowering Credit Card Interest Rates

Stop the madness! You don’t have to be bogged down by high interest rates.

Check out these tips on how you may be able to get lower interest rates and save yourself some serious cash:

  1. Review your latest statements. Figure out how much money you owe and how much interest you’re paying on all of your credit cards. You may want to make a spreadsheet to keep track of everything. Need help? Check out our debt calculator.
  2. Compare. Is your interest rate lower on one card than another? Sometimes credit cards for specific stores come with high interest rates. Consider using these cards less than the cards that have more reasonable rates.
  3. Find your cardholder phone number and call it. The customer service number should be on the bill somewhere. Call one company at a time and discuss your interest rates.
  4. Negotiate. Ask flat-out for a lower interest rate. Tip: the old adage about catching more flies with honey than vinegar probably applies here. You may also want to mention the lower interest rates on your other credit cards or that you’ve recently received offers to transfer your debt to another lower-interest card.
  5. Push your luck. Once you’ve gotten a cardholder to agree to a lower interest rate, ask it to drop (or reduce) other fees as well. Annual fees, ATM fees, “free” check fees and others can add up fast. Remember, the worst anyone can say is “no”.

When to Ask for a Payment Plan or Lump Sum Settlement

If you’re current on your payments, negotiating for lower interest rates should be a breeze. But if you’ve fallen behind on payments, another solution may work out best for your finances.

If you haven’t been able to make credit card payments for a few months, ask for a modified payment plan.

Most credit card companies would prefer to receive small payments from you than nothing at all (which is what they could receive should you choose to file bankruptcy).

You may also consider offering to make a lump sum payment—some companies will let you pay less than the owed amount and forgive the rest of the debt.

When to Consult with a Bankruptcy Lawyer

If you’re considering filing bankruptcy, you may want to talk with your bankruptcy lawyer before making calls to your credit card companies.

The bankruptcy court may frown upon making some select payments and then not paying on other debts, so be sure you won’t be penalized for taking action.

The Last Step: Get Everything in Writing

Once you’ve negotiated the terms of your payment with your creditors, be sure to request a letter outlining the terms you agreed upon.

You probably also want to have your bankruptcy lawyer review it for accuracy and appropriateness.

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Posted in Credit and Bankruptcy | No Comments »

Monday, December 29th, 2008

Crime Spiking Thanks to Dumpy Economy

The Retail Industry Leaders Association conducted a survey of 52 chain retailers and found that about 80 percent said organized retail crime has jumped, with 50 percent also reporting that robberies and burglaries also increased.

The bottom line to this shoplifting increase is that people are hurting. Some are desperate and resort to swiping product rather than swiping their maxed-out credit cards.

While retail crime usually increases during the holiday season, law enforcers say the economic tailspin is flaming more frequent and more aggressive crimes.

Retailers are hurting too: last year retailers lost an average of almost $35 billion (1.4 percent of inventory) due to theft. Most say they can’t bear that kind of loss—especially because shopping is down all across the board.

Are you struggling to make ends meet?

You have options. Talk to a bankruptcy lawyer today about all of your debt-relief options.

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Friday, December 26th, 2008

5 Reasons the U.S. Economy Will Be Better in ‘09

We may have real reasons to be hopeful for a better fiscal year in 2009. Read up on MSN’s top 5 reasons to believe we’re heading in the right direction:

  1. Oil Prices Are Dropping. Those gas prices are going down and keeping more of your cash in your pocket. A JPMorgan Chase economist estimates the drop in oil prices represents “a boost equivalent to a $350 billion stimulus,” which could boost GDP by as much as 2 percentage points.
  2. Mortgage Rates Are Sinking. Rates for a 30-year fixed mortgage fell to a low 5.9 percent—thanks in part to the Fed’s promise to purchase mortgage securities. This will likely help open up affordable housing and give current homeowners a chance to refinance. In the works: the Treasury is reportedly pondering a plan to drop mortgage rates as low as 4.5 percent for new homeowners.
  3. The Fed Has Stepped In. The Fed is in overdrive as it does whatever it can to strengthen the economy by adding liquidity to the system. It’s pushed short-term interest rates to almost 0 percent and said it will buy debt securities in an effort to unfreeze credit lines. This means for next year, you’ll likely be paying a lot less for your borrowing.
  4. Obama Will Be President. Over the next two years, it appears that Obama and the new Congress will spend between $750 billion and $1 trillion to boost the slumping economy. These injections will caffeinate the markets and likely create new jobs. We'll also probably be looking at tax cuts for the middle-class.
  5. We’re America. America is flexible and innovative--we'll get through these tough times and become stronger because of them. The article argues that the core economy is far stronger than it was in the ‘70s thanks to higher productivity and better tax and regulatory practices.

Looking to Get Rid of Your Old Debt and Start Fresh in 2009?

If you’re struggling to make ends meet, facing foreclosure or having a tough time paying your bills, filing bankruptcy may be a good debt-relief option for you.

Talk to a local sponsoring bankruptcy lawyer today—for free and with no obligation.

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Wednesday, December 24th, 2008

God is Filing Bankruptcy — or at least his “houses” are…

This tough economy hasn't spared houses of God.

Church bankruptcies are becoming a more common occurrence as giving is down and the maintenance and mortgage bills are piling up.

In fact, church giving is down almost 15 percent in some areas, according to a recent Wall Street Journal article, resulting in some churches turning to filing bankruptcy to avoid foreclosure.

Check out the WSJ article for the whole story.

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Tuesday, December 23rd, 2008

Bills Keeping You Down? Check Out These Tips on Saving Money

Whether you’re recovering from bankruptcy or just trying to improve your financial situation, you’re probably looking for ways to make sure your finances are in top shape.

If you’re ready to start spending and saving a bit more wisely, you’ve come to the right place.

This page is designed to offer you some everyday tips for hoarding a little more of your hard-earned cash.

Pack it Up: Buying lunch every day may not seem like a major expense, but small purchases add up fast. Whether you pack five lunches on Sunday night or throw some food in your bag each morning before work, you could end up saving hundreds of dollars each month.

Shop Generic: Your grocer likely carries store-name brands of your favorite foods, and many of these taste no different from the pricier name brands. Save money at the grocery store by buying generic for a week or so – you can always switch back to name-brands if you don’t think the taste matches up.

Clip Coupons: Coupons are not just for grandmas anymore. Web sites like couponmom.com and others offer amazing savings on everyday purchases.

Make Some Coffee: Don’t worry – we’d never ask you to sacrifice your caffeine fix for the sake of savings. But, if you’re buying java by the cup every day, you’re likely dropping hundreds of dollars a year on the habit. Home-brewed coffee is much cheaper.

Walk it Out: This is a double whammy. Consider dropping a pricey gym membership (especially if you don’t use it that often) and walking to complete minor errands. This will save you on gym costs and on gas.

Crunch the Numbers: Is your cell phone plan the most logical for your talking and texting habits? What about your TV and Internet packages? Figure out how much you spend each month and see if you could cut back.

Put on a Sweater: Yes, we know you hated it when your dad told you to put on a sweater when you complained of being cold as a kid, but the man had a point: heating costs add up quickly, so if you’re chilly inside, consider layering.

Barter: Before currency was common, the barter system allowed people to trade goods and services without exchanging cash. Consider trading favors with friends (take turns babysitting each other’s kids, for example) or joining the retro-chic Swap Meet trend. Invite over some friends and tell them to bring clothes they’re no longer wearing – then trade the night away.

Thinking About Filing Bankruptcy?

If you’re struggling with mountains of debt and are having a hard time paying your bills, filing bankruptcy may be a good debt-relief option for you.

Talk to a bankruptcy attorney today.

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Posted in Financial Literacy | No Comments »

Tuesday, December 23rd, 2008

Tribune Bankruptcy: Rumors of Media Death Are Exaggerated

The Tribune Co. filed Chapter 11 bankruptcy. Although many people are not surprised to see another business bankruptcy, this is big news because the Tribune Co. is the news for many people around the country, including Los Angeles.

The Tribune Co. owns eight major daily newspapers, including the Chicago Tribune and the Los Angeles Times. It also owns many local television stations.

The recession is particularly hard on businesses that depend on advertisers for revenue.

Salon points out that in the wake of the dot com bust, consumers were left with a lot less printed business and technology magazines and online news Web sites.

However, we’ve never had a problem finding technology news. The nature of the Internet provides an abundance of all varieties of information and news from around the world.

In these hard times, it’s necessary for businesses that depend heavily on advertising to restructure themselves. Under Chapter 11 bankruptcy, the Tribune Co. will need to reorganize, rethink and restructure in order to survive.

When the Tribune Co. was bought by Sam Zell, he reportedly took on a tremendous amount of debt. This left the company in a precarious position in the ultra-competitive news business and the economic recession only compounded the danger.

In order for Zell's business model to work, he needed huge profits. In today's economy, that’s just not possible. Advertisers have scaled down and the news market has to make adjustments in order to survive.

No matter what happens, there will be no shortage of news.

There are plenty of newsworthy events happening around the world and plenty of writers willing to put it into words.

There’s also a genuine need for news, and hopefully (and eventually), there will be advertisers who are once again able to pay.

As consumers, we need not worry about having the news brought to us—it just many not come packaged in the same way as we are accustomed to seeing it.

However, the bad news may be for writers and others who make their living in the news industry.

There is no doubt that the news media landscape will change.

Writers will suffer layoffs, rather than reporting the mass layoffs around the country. The recession has brought lean times to every industry, and the news industry will not escape unscathed.

Not all hope is lost though. If the news media is anything, it is versatile.

Since news is a necessary component of the civilized world, we can be certain that the strong will weather the storm and thrive in the face of adversity. After all, that is the American way.

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Tuesday, December 23rd, 2008

Analysts: Economy Shrinking, Could Get Worse

The Commerce Department reported today that the gross domestic product (GDP), the economy’s total output of goods and services and a major metric of economic health, declined at an annual rate of 0.5 percent in the July/September quarter.

Analysts had estimated this drop a month ago and are now predicting that this current quarter will experience a much more dramatic decrease.

In fact, some analysts believe the GDP could drop as much as 6 percent this quarter—the largest decline in 26 years.

Analysts further calculate similar declines in the first and second quarter of 2009, but expect the economy to start growing next summer, with the recession likely ending in June 2009.

By that time, the recession would go on record as being the longest recession since World War II.

This GDP drop came after a 2.8 percent increase in the spring, which was largely accredited to the millions of dollars that was dished out through economic stimulus packages.

Breaking it Down

  • Economy has lost jobs every month in 2008 (totaling 1.9 million, with more than 0.5 million jobs lost in November)
  • Unemployment rate at 6.7 percent—highest in 15 years
  • Consumer spending dropped at an annual rate of 3.8 percent—biggest decline since 1980
  • Corporate profits fell 1.2 percent—fifth consecutive quarter drop
  • Residential construction fell at an annual rate of 16 percent
  • Non-residential construction fell 1.7 percent

Feeling the crunch? If you’re having a hard time paying bills and making ends meet, filing bankruptcy may help you eliminate or payoff your debt.

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Monday, December 22nd, 2008

Bush’s Role in the Economic Crisis

In the midst of a global economic crisis, President Bush has asked “How did we get here?”, according to sources close to the president.

Well, the New York Times has an answer for him.

A recent article said that Bush’s own policies and actions contributed to the economic collapse---and it has supporting evidence to back that claim.

The article contends Bush loudly pressed to expand homeownership (especially to minorities), much to the happiness of some of his largest campaign donors who were set to benefit from that approach.

The article further said that Bush’s policies on the housing market and his “hands-off approach” to industry regulation encouraged laid-back lending criterion.

If you’re struggling to make it through these tough times, check out Total Bankruptcy  for filing bankruptcy information on how you may be able to eliminate or reduce your debt.

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Thursday, December 18th, 2008

46,000 Workers Affected by Chrysler Shutdown

Chrysler announced that as of Friday, it will shut down its 30 manufacturing plants for at least a month.  The company blames lower demand for its vehicles in the tightening consumer credit market.  Chrysler is the last of the big three automakers to announce such a cutback; last week GM took approximately 250,000 vehicles out of production, temporarily closing 20 factories.  Ford added a week to its annual two-week shutdown.

Chrysler says dealers nationwide confirm that the market is strong in terms of consumer interest, but that dealerships are often "unable to close the deal" as prospective buyers are unable to obtain financing.  The company estimates that sales volume has dropped 20-25% due to the lack of available consumer credit.

Affected employees will be eligible for state unemployment benefits and some benefits from the companies, but will not receive full pay during the layoff.

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