Financial challenges can impact anyone in Indiana. Whether it is medical expenses, credit card debt or business problems that have extended to personal finances, it is important to understand that there are legal strategies that while bankruptcy might not be viewed as a viable alternative, it can be useful to clear debt and start over. A recent filing made by a former NFL player who does business in the state can serve as an example of how these issues can suddenly crop up.
Former Colts linebacker files for Chapter 7 bankruptcy
A retired linebacker for the Indianapolis Colts, Gary Brackett, filed for bankruptcy after his chain of restaurants ran into trouble. Mr. Brackett was a member of the Colts Super Bowl championship team in 2006. In the filing, the 41-year-old reported that he had assets that were worth more than $2 million while owing around $5.8 million. He had 10 restaurants in total with nine in Indianapolis and one in Ohio. The ongoing health situation was a major contributive factor in the restaurants closing. The income suffered greatly due to the loss of revenue from the lack of sporting events and the safety restrictions limiting the number of patrons. According to Mr. Brackett, the debts are predominately business-related.
People can file for Chapter 7 bankruptcy for many reasons
Those who have a struggling business might think they need to file for a Chapter 11 reorganization. However, if the circumstances dictate that a liquidation is the better path, then Chapter 7 could be a preferable strategy. Chapter 7 is known as a “liquidation” bankruptcy. This means people can keep properties if their value is below a certain level, but other properties might be taken and sold to pay back creditors. There are requirements like the means test, income requirements, debt assessment and more. For those who have lost their jobs, are overextended on their credit cards or are dealing with medical expenses they cannot pay, Chapter 7 may be a viable way to clear their debt. In some instances, business owners should also consider it.
Chapter 7 could be a wise step to clear debt
As Mr. Brackett’s case shows, debt challenges can occur to anyone even if they have name recognition, noteworthy accomplishments and had achieved success in multiple areas. Those who are reluctant to file for Chapter 7 bankruptcy or other forms of bankruptcy should be cognizant of how it can help them with their finances. Consulting with those who are experienced in these matters can give advice and guidance with how to proceed and get onto stronger financial ground legally and efficiently.