Gift cards could become hassle if Sears goes under, expert says to use them soon

SAN FRANCISCO (KGO) -- Well, there are no guarantees but it appears Sears will make it through the holidays, after that who knows? If you are a consumer, be very careful. Items that come with warranties are generally guaranteed after a bankruptcy, but going through the process can be a big hassle once a store closes.

The 125-year-old retailer had 2,300 stores in 2005. Now the former giant is down to 506 and it keeps shrinking. Still, the stores that are open in the Bay Area seem to be doing a brisk business.

RELATED: Sears closing 2 Bay Area stores after filing for bankruptcy

Holly Hewitt is a longtime customer. Today, while shopping for her grandsons, she tells me she would miss her Sears if it closes too.

"I am not happy about it, I think they have a great variety of stuff with very low prices and their sales are great when they are getting rid of stuff, the clearance items."

And it is not just the loss of a place to shop, it could be the loss of tens of millions of consumer dollars. Gift Card Girlfriend, Shelley Hunter, says there is $46 million in Sears gift cards outstanding.

"If you have a Sears gift card you really need to use it right away. Once a store files for chapter 11 Bankruptcy, courts decide whether or not gift cards will be accepted. So although Sears say they are accepting gift cards. If should really be considered 'for now'."

Still think you want to push things? Looking for the ultimate deal? Shelley says be careful.

RELATED: Sears Through the Years: 7 Things to Know

"Often times people wait to use their gift cards thinking they are going to get the possible bargain at a liquidation sale. Two things can happen. One, the merchandise can be highly picked over, and two, the cards may not be usable throughout the sale."

Sears just got loans of $350 million to see it through the holidays and Hewitt says you'll see her shopping there.

"I will keep coming up here till it is gone."

Take a look at more stories and videos by Michael Finney and the 7 On Your Side team here.