Irvine-based New Century Financial Corp. has asked for a one-month extension to file a plan of liquidation with Delaware’s bankruptcy court.
The failed subprime lender, which is in the process of winding down operations and selling off its businesses, said in a court filing this week that it needs until Dec. 28 to figure out a plan to deal with creditor claims totaling $35 billion.
Creditors aren’t expected to get anywhere near that much. New Century sold off the biggest chunk of its business in June for $190 million, and sold another $187 million of its loans in two sales this summer.
Legal and professional bills from the bankruptcy could end up eating away close to $100 million of New Century’s remaining money, according to bankruptcy law experts.
Some 3,700 claims have been filed against the company. Figuring out which claims are valid has been “an intense and time consuming process,” the company told the court.
New Century’s dwindling staff and the pressures of lawsuits and regulatory probes has added to the complexity of the company’s efforts to figure out a liquidation plan, the filing said.
The company now employs 107 people, down from the 6,000 workers New Century had just prior to its April bankruptcy filing.
