KLAS-TV Channel 8 News Las VegasRising Foreclosures Impact Las Vegas Bankruptcies
As the number of homes on the foreclosure list continues to climb in the Las Vegas Valley, some homeowners are turning to bankruptcy as a last and desperate resort.
Filing for bankruptcy was never part of the plan when Christy and Andrew Edwards bought their home three years ago. Like many in their situation, the Edwards got into an adjustable rate mortgage and it's been downhill since.
"It just started piling up. We couldn't handle it anymore and we didn't know which way to turn," said Christy Edwards.
They finally turned to bankruptcy attorney Randolph Goldberg who says business for him has tripled in the last few months.
"Everybody seems to be giving up their homes or are behind on their mortgage payments and want to discuss their options whether to keep the home, let the house go or short sale the house. They don't know what to do," said Goldberg.
Records show Chapter 13 bankruptcy filings in Las Vegas have more than tripled from the first half of last year to the first half of this year, jumping from 567 to 1,717.
Goldberg says different types of bankruptcy are viable options for those looking to either walk away or try to hold on to their house.
"Chapter 13 allows the client to let the client save the home if they want to. If they are behind, it gives them the luxury of letting them start their regular mortgage payments up again, and pay court back monthly payments paying the money they are behind," Goldberg said.
But Consumer Credit Counseling Service in Las Vegas warns about the consequences.
"If the consumer doesn't have the ability to make their regular house payment after the bankruptcy, then the bankruptcy to save the home isn't necessarily the correct alternative," said Michele Johnson, Consumer Credit Counseling Service.
Johnson says to remember the hit to your credit and what it means for your future. For the Edwards, they feel bankruptcy was their best option.
"The bill collectors will still keep calling and this way they don't," Christy Edwards said.
Attorneys and credit counselors say the best thing to do is check out all of your options before you make the decision to file for bankruptcy.
