What is Chapter 7?

Posted By: Asim Mohammed
According to the United States Bankruptcy Code there are different “chapters” to file under, chapter 7 and chapter 11 and chapter 13. People have always heard of the chapter 11 on the news for when corporations or businesses are in trouble. One of the primary purposes of bankruptcy is to discharge certain debts to give an honest individual debtor a fresh start. One of the most common forms of bankruptcy is chapter 7. Chapter 7 governs the process of liquidation under the bankruptcy laws of the United States. Under chapter 7, the bankruptcy trustee will gather and sell the debtor’s assets and uses the proceeds of such assets to pay creditors in accordance with the provisions of the Bankruptcy Code. Part of the debtor's property may be subject to liens and mortgages that pledge the property to other creditors. Also, filing under chapter 7 may result in a loss of property. In order to qualify under chapter 7, debtor may be an individual, a partnership, or a corporation or other business entity. Chapter 7 has different laws for businesses filing to individuals filing. There is a certain process that requires someone to fill out forms in court to people preparing the bankruptcy proceedings and going through the court system.




http://www.uscourts.gov/bankruptcycourts/bankruptcybasics/chapter7.html


http://en.wikipedia.org/wiki/Chapter_7,_Title_11,_United_States_Code


http://www.investopedia.com/ask/answers/190.asp

Athletes Going Broke

Posted By: Asim Mohammed

Many athletes, active and retired ones always have financial troubles, whether it’s not knowing where their money is going, to just going broke because of ridiculous expenditures and not being adequately educated.

The Toronto Sun ran a piece on athletes going broke and came up with a stat that says about 60% of retired NBA players go broke five years after their NBA pay checks stop arriving. Many famous athletes are in trouble because of the lack of education on how to handle their money. Many of them come from poor back grounds and when they start receiving millions of dollars from lucrative player contracts, they spend it on friends who want big houses, expensive cars, and clothes. Evander Holyfield is one of these athletes. He cannot make child support payments, and his 54,000-square-foot, 109-room; 17-bathroom home was set for auction due to a $10 million loan default. Another case of an athlete in financial trouble is Latrell Sprewell, a former NBA all star, Sprewell was in the final season of a $62-million five-year contract with the New York Knicks, said he was insulted by the Minnesota Timberwolve’s offer of a contract extension that was reportedly worth between $27 million and $30 million for three seasons. Sprewell stated, “I’ve got my family to feed.”

There are many stories of rich athletes going broke either during their playing times or afterwards. If athletes can educate themselves, earn money management skills and make smart, safe investments along the way, they should be good shape for the future.

http://www.mickhagen.com/2008/08/04/athletes-and-bankruptcy/

http://www.briancuban.com/why-athletes-go-broke/

http://sports.espn.go.com/espnmag/story?id=3469271

Getting Started When Filing Bankruptcy

By Kaitlin Lanier

Bankruptcy can be a hard pill to shallow. However, especially in a recession, it may be a necessary step because there are no other alternatives. Therefore, if bankruptcy becomes the only choice, the person who decides to file should know exactly how to file. Being prepared and educated can be half the battle. Thus, these are the easiest and least painful tips if filing for bankruptcy becomes the solution:

First of all, one should keep in mind that filing for bankruptcy is a legal process. Therefore, doing research and being well-informed can help before the process even starts. It allows for such a person to make an educated decision on whether or not to do the bankruptcy process alone or with professional help. It is quite possible to complete the process alone, but it would be time consuming and require a lot of patience.

If one decides to go about the process alone, he or she must decide to file Chapter 7 Bankruptcy or Chapter 13 Bankruptcy. The most popular is Chapter 7, which is a straight or liquidation bankruptcy, but the BAPCPA has made it more difficult to file a Chapter 7 case because of the means test. Because of this test, many individuals will be forced to file a Chapter 13 case, which is a repayment plan for individuals. Either way, make sure to do research and understand which case suits specific needs before deciding and filing.

On the other hand, it might be easier to hire a bankruptcy lawyer to help guide an individual through the entire process. Such a person will need to provide the lawyer with all of his or her personal information in order for the lawyer to put together and file the petition. Once the documents are filed, the individual will be assigned a trustee that will make sure all the necessary information is collected and accurate.

From then on, whether an individual had decided to hire a lawyer or not, he or she must notify all creditors that he or she is filing for bankruptcy so the creditors will stop all actions they might be taking to make sure they receive their payments. Later procedures might include meeting with all parties involved in an individual’s case, meeting with creditors, or even meeting with creditors’ lawyers. Bankruptcy filing is a long process and should be carefully considered before deciding upon.

Sources:
Filing Bankruptcy: The Bankruptcy Process by BankruptcyHome.com
Filing for Bankruptcy Online by FilingforBankruptcyOnline.com
How to File Bankruptcy in the United States by wikiHow