Bankruptcy proceeding comes to an end for football coach

Bankruptcy can be a long process for Mississippians who are struggling to gain control over their finances, but in the end it can offer significant resolution and relief. The personal bankruptcy of a football coach from another southern state demonstrates the benefits.

The football coach decided to file for individual bankruptcy last year, claiming over 40 million dollars in debt. Now, almost a year later, he has debt relief. A settlement has been reached in his Chapter 7 bankruptcy, although the case was originally scheduled to go to trial. In exchange for the discharge of most of his debts, the football coach will have to pay about $265,000 in cash and turn over real estate worth about $400,000.

This is a significant resolution between the football coach and his creditors. Of note, the coach got to keep his income that he earned after the date of his bankruptcy filing even though it was quite significant. While this angered many of his creditors, the retention of his salary comports with the law.

Although an individual can often keep recently earned income, it is important to remember that not all debts are discharged after Chapter 7 bankruptcy and so there may be other required payments and expenses. These debts include, but are not limited to: debts not listed in the bankruptcy petition, student loans and child and spousal support.

In this case, the football coach appears to have worked out a deal with his creditors to account for his debts and avoid unexpected payments. It can be useful for an individual who is considering filing for bankruptcy to similarly work with creditors and his or her attorney to reach an agreement.

Source: USA Today, "Ex-Arkansas coach discharged of debt in bankruptcy deal," Brent Schrotenboer, Sep. 5, 2013

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