Nov 11
Circuit City Stores CCTYQ.PK filed for Chapter 11 bankruptcy on Monday, citing tougher credit terms from vendors and market share losses to rivals such as Best Buy Co.
A lookback to Circuit city:
In December 2006
Circuit City reports a surprise fiscal third-quarter loss after it cut prices on hot electronics
In January 2007 to December 2007:
Circuit City says it is closing about 70 international stores
Circuit City’s Chief Financial Michael Foss might leave the company in April
Circuit City posts a fiscal fourth-quarter loss on store closures
Circuity City asks former employees were replaced by lower-paid workers earlier in the year.
In January, 2008:
December sales at stores open at least 12 months fell 11.4 percent due to US economy
Entertainment industry investor Mark Wattles indicated a filing that firm had acquired 6.5 percent stake in Circuit City
In September 2008:
Circuit City reports a wider fiscal second-quarter loss
Circuit City receives notice from NYSE that it does not comply with listing standards since its closing stock price has been less than $1.00 over 30 consecutive trading days.
In November 2008:
Circuit City announces plan to liquidate and close 155 of its U.S. stores.
Circuit City files for Chapter 11 bankruptcy protection, shares delisted from NYSE
Sep 18
A market shaking news about bankruptcy filing byAmerican International Group forced federal officials to come into rescue of AIG to keep the nation from another economy crisis. AIG is bound to receive an $85 billion bridge loan from the Federal Reserve and Federal will keep estimated 80% stake of the Company which was purely aimed at keeping the giant insurer out of bankruptcy and prevent more crisis.
I always felt funny about the television ADs, where Agent would say dont waste money on Coffee, Car, Purse. If AIG had filed bankruptcy, I would have felt sorry for the people who believed on that ADs.
Aug 13
As a result of filing bankruptcy, many consumers are required to attend credit counseling. The best method of pursuing this is to do it under Chapter 13 of the United States Bankruptcy Code. You are able to set the plan approved by the Court and then make your payments to the Federal Court Order that will stop the interest, late fees and collection calls. It is in your best interest to use the leverage of the Federal Court and avoid being taken advantage of by fraudulent credit counseling services.
You must be savvy in choosing the appropriate debt counseling service. Many companies will only wait until the bills go to collection and into default before they begin making the payments on your debt. This often destroys a consumers credit rating. You should also be savvy in choosing the appropriate debt consolidation loan.
Loans will consolidate all of your debt, but you must be sure that you will be able to repay the entire loan amount. You must understand the term and the interest rate on the loan. Some loans may require a balloon payment at the end of the loan. This is something that you should be aware of, as many lenders will entice you to take out another loan to pay the balloon payment.
Be wary of home equity loans if you are already having difficulty making ends meet. If you are unable to pay the home equity loan back, your home may be foreclosed upon to pay the debt. Due to the Texas Homestead Act, your home is safe from unsecured debts that are not exempted by the Homestead Act. Most states have an exemption that protects a certain amount of your home equity, but if you choose to pledge that amount to the loan then the Homestead exemption will no longer protect your home.
Be certain that you fully understand the program or service that you are participating in. Some services will negotiate with your creditors or make payments on the debt for you after you make a payment to them. You should understand whether the service promises to lower the amount that you owe or the interest rate that you pay. Others will promise to lower your monthly payments without changing your situation. They may also charge fees for handling your debt for you.
Some debt counselors will also only work with unsecured commercial creditors and will not help you with child support or unpaid taxes. They will actually ignore the debts that will not go away will send you money to those claims that could be discharged in bankruptcy.
There are several debt management services that are offered at a modest cost. It is often best to look for these non-profit services. For-profit or fee-based services should be approached cautiously and you will want to ensure that the service is worth what it costs.
By not choosing an appropriate service, you may find yourself in deeper debt and your credit rating may be very low at the end of the process.