California Bankruptcy Lawyer Blog

San Jose Bankruptcy Attorney Discusses Under Bankruptcy Protection, Northwest Airlines To Pay Lenders Over $23 Million

Last Week, Northwest Airlines worked out a deal to pay J.P. Morgan and Co. and other lenders more than $23 Million—less than 50% of the $55 million to $60 million that lenders were asking for in relation to a dispute over a $975 million loan. The settlement must be approved in court.

The airline company filed Chapter 11 Bankruptcy last year. In order to exit bankruptcy, Northwest says it has to cut $2.5 billion in costs.

A U.S. Bankruptcy Court must also approve the agreement reached between Northwest Airlines, Boeing Co., and Rolls-Royce PLC that will let the airline accept delivery of its new Boeing 787 planes beginning the 3rd quarter of 2008.

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San Jose Bankruptcy Attorney Discusses Bankruptcy Filings Decrease One Year After New U.S. Law

In the United States, the number of people filing bankruptcy to erase their debts has decreased since the country revised its bankruptcy laws last year and Congress began mandating an income-based test for measuring a debtor’s ability to repay his or her financial obligations.

Because of this, less people are able to file a Chapter 7 bankruptcy, and debtors who have an income higher than their state’s median and can pay at least $6,000 over a five-year period must file Chapter 13 bankruptcy nd repay some of their debt.

In California, the median for a single earner is $43,107. The median for a family of four is $70,172.

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