Bankruptcy And Debts

Consolidation Debt Mortgage Less than a year after the nation's most-populous state, California, endured blackouts and political and economic turmoil when it deregulated the power industry, the second-most-populous state, Texas, this week began its own deregulation plan with officials promising that there would be no reprise of California's chaos.

Now Enron's bankruptcy increases "the risks and uncertainty in the business, " Rowe said. long movement to deregulate and restructure energy industries, he said. Deregulation, the setting up of competitive markets for electricity generation and marketing, was not the disaster elsewhere that it proved to be in California. Newly competitive arrangements, under cautious state supervision in Ohio, Pennsylvania and other states, helped to bring down electricity rates in most parts of the country over the last decade and a half.

Consolidation Debt Help But consumer advocates, while generally agreeing that the Texas plan included better safeguards than California's, expressed skepticism that residential customers would benefit from long-term reductions as energy providers competed for business. These advocates also warned that Texas, like California, failed to provide adequate protection to ensure that the state did not suffer from electricity shortages as demand increased.

Bankruptcy is a court process that allows an individual or business to get relief from their debts. The ultimate goal of bankruptcy is to give the individual or business a fresh financial start while being fair to creditors. How Can a Business File for Bankruptcy Chapter 7 and Chapter 11. Once bankruptcy proceedings are started (whether through Chapter 7 or Chapter 11), creditors cannot attempt to collect debt from the business until the bankruptcy process has ended.

Consolidation Credit Debt For Texas, deregulation comes not long after the Enron Corporation, the Houston energy giant that championed deregulated energy markets, collapsed into bankruptcy. Meanwhile, the chairman of the state agency that will oversee the deregulated electricity market, has come under fire for his ties to Enron.

Both types of bankruptcy may get rid of unsecured debts and stop foreclosures, repossessions, garnishments, offs, and debt collection activities. Both also provide exemptions that allow people to keep certain assets, although exemption amounts vary among states. Note that personal bankruptcy usually does not erase child support, alimony, fines, taxes, and some student loan obligations. And unless you have an acceptable plan to catch up on your debt under Chapter 13, bankruptcy usually does not allow you to keep property when your creditor has an unpaid mortgage or lien on it.

Bill Consolidation Debt The official start of deregulation in Texas was New Year's Day, but today was the first business day of operation and, as yet, few of the 4.7 million eligible households had chosen to switch providers away from the longstanding utilities. State officials predicted that the transition would be gradual, particularly for residential customers, many of whom are still unaware that change is afoot. Nor have electricity retailers rushed into the residential market; as yet, 41 new retailers have registered, but most are seeking commercial and industrial clients.

Chapter 7 Bankruptcy involves the selling off (or "liquidation") of a business' property to pay off debts. The bankruptcy process starts when the business files a petition with the bankruptcy court. The petition must list all of the business' property, debts, and recent financial history. The court will then appoint a trustee who will sell off some of the business' property to help pay the business' debts. Some debts will be discharged by the trustee, meaning that the debts will not have to be paid. Other debts are not dischargeable including recent taxes, debts in prior bankruptcy, and penalties payable to the government.

Consolidation Debt Quote Terry Hadley, spokesman for the Texas Public Utility Commission, the agency overseeing the electricity marketplace, said electricity retailers were "sharpening their pencils to see what kind of offers they can make." Several companies are already marketing to residential customers. and Mr. Hadley predicted that such appeals would intensify in coming months.

But you will literally wipe the slate clean, except for Student Loan debts which remain due after bankruptcy.

Consolidation Debt Lead Still uncertain is whether Texas customers will embrace deregulation, particularly after the problems in California. The rules here establish an immediate retail price reduction of 11 percent to 17 percent, a drop partly attributable to the low price of natural gas, which is often used to fuel electric generation plants. This savings is built into the "price to beat," the state-mandated price per kilowatt hour that the old utilities will be allowed to charge under deregulation to keep their customers. New retailers will be allowed to offer lower prices as a way to entice customers to switch.

Consolidation Debt Non Profit Texas officials have taken pains to reassure consumers and journalists that California's problems were unique.

Consolidation Debt Loan Online In California, the state deregulated the wholesale power market while keeping retail prices capped. This caused the state's two biggest public utilities to lose billions of dollars when wholesale prices spiked and the retail price caps prevented them from passing the costs along to consumers. One reason the prices jumped was the price of natural gas, then at a record high.

Consolidation Debt Home Loan California officials, including Gov. Gray Davis, also accused several energy companies, including Enron, of manipulating prices and making the state's problems worse, a charge the companies denied.

Christian Consolidation Debt California's problems were also partly attributable to a lack of supply; the state had not built a major power plant in roughly a decade.

Consolidation Debt Information The state endured rolling blackouts and other problems before federal regulators ordered restraints on electricity prices last summer. In September, the California Public Utilities Commission voted to shift away from deregulation.

Agency Consolidation Debt While about two dozen states, including most of those in the Northeast, have begun deregulation, others, like Nevada, New Mexico and Oklahoma have postponed plans in the wake of California's problems. Texas officials, on the other hand, express confidence in their plan.

Consolidation Debt Solution Unlike California, Texas deregulated the wholesale electrical market in 1995, providing a time buffer to work out any kinks before introducing retail deregulation this year. And also unlike California, Texas has seen about 30 power plants built in the state in the last six years. Officials say the state's electrical supply exceeds demand by 23 percent.

California Consolidation Debt Nor does the state's plan mandate the sort of retail price caps that crippled the California utilities.

Consolidation Debt Loan Uk "We have more than enough capacity and supply of electricity," Mr. Hadley said. "And the mechanics are in place to make adjustments for any dramatic spike in fuel costs."

Consolidation Debt Equity Home Consumer advocates are skeptical. Carol Biedrzycki, executive director of Texas Ratepayers Organization to Save Energy, said the state should have required electricity providers to maintain a "reserve margin" of electrical capacity of roughly 15 percent above demand. Ms. Biedrzycki said she believed that state officials had inflated power-generating capacity and could face problems of increasing demand in a few years.

Consolidation Debt Government "In order to keep the prices stable, we have to have a reserve margin," she said.

Consolidation Debt Firm The Texas Public Utility Commission has been in the spotlight recently because of questions of whether its chairman, Max Yzaguirre, a former Enron executive appointed by Gov. Rick Perry, misrepresented his connections to the company on state disclosure forms. Last month, as Enron was in the midst of bankruptcy and laying off more than 4,000 employees, Mr. Yzaguirre revised his disclosure forms to expand the list of Enron-related companies to which he had been connected.

Consolidation Debt Financing Initially, he had listed his position with Enron's affiliate in Mexico. But his revised listing showed his membership on the board of the Enron North America Corporation and other related companies. Mr. Yzaguirre has attributed the omission to a simple oversight, but a spokesman for a leading Democratic candidate for governor, Tony Sanchez, questioned whether Mr. Yzaguirre had a conflict of interest. One of the new retailers seeking to enter the market, the New Power Company, is partly owned by Enron.

Consolidation Consumer Credit Meanwhile, Mr. Hadley, the spokesman for the commission, said Enron's bankruptcy should not have an impact on deregulation in Texas. Some commercial customers had signed up with two Enron-related electricity retailers, he said, but state regulators are making certain that those customers can be switched to other providers.

By Jim Yardley
New York Times - 1/3/2002

Topic: Energy