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Store Closings: What They Mean for Gift Cards, Warranties & Saving!
You’ve likely noticed the hordes of “Going Out Of Business” signs posted along busy intersections and mall entryways across the country. Given current economic conditions, many popular stores are planning to close some or all of their doors forever in the coming months. Following these tips will ensure that you get what’s coming to you… and maybe even score some really great deals:
Know the lingo. “Bankruptcy” seems to be the newest buzzword. As far as retailers are concerned, Chapter 7 and Chapter 11 bankruptcy are the most common. Chapter 7 means they’re closing down permanently and liquidating assets to pay off creditors, while Chapter 11 means they plan to reorganize (i.e. make layoffs and close down some stores) but continue to stay in business.
Clean out your wallet. Dig out those pretty gift cards and store credits you’ve been saving for a rainy day. If any of them are on the list of doomed retailers call the store nearest you and ask about their policy. Retailers who have filed for Chapter 11 bankruptcy will often continue to redeem gift cards, while those who file for Chapter 7 may not make good on them. If this is the case, you have two options: 1. If you paid for that gift card with a credit card, you can dispute the charge directly with your card holder; or 2. If you paid with cold hard cash, check or a debit card, you can file a claim with the bankruptcy court administering the process within 90 days of the filing date. For more information on filing a claim, check out www.uscourts.gov. Bottom line – if your gift card is still valid, redeem it as soon as possible.
What about that warranty? It depends. Warranty validity will vary with each bankruptcy. Manufacturers warranties will not be affected because a retailer went out of business and extended warranties that are backed by a third party is usually not affected when a retailer closes shop.
Cash in on the savings. You can expect retailers who are in the black to slash prices 60-90% right down to the last day of business. Inventory is sure to dwindle, but you can expect prices to near rock bottom during the final weeks of operation. Our recommendation? Stake out your favorite stores early and often – especially if you have your eye on something special.
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