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Singer seeks fresh start through Chapter 7 bankruptcy

The two primary forms of bankruptcy protection available to consumers in the United States are Chapter 7 bankruptcy and Chapter 13 bankruptcy. While both Chapter 7 and Chapter 13 have benefits, when given a choice between the two, most people tend to prefer Chapter 7. One reason is that Chapter 7 allows debtors to exhaust the majority if not all of their debt and obtain the fresh financial start they desire with relative ease. Some Tennessee residents might benefit from Chapter 7 bankruptcy as a form of debt restructuring and being about to rid themselves of financial woes.

It was recently reported that famed country singer Eddie Montgomery has fallen on hard times. The singer filed for bankruptcy recently listing more than $13 million in liabilities and just under $2 million in assets. The largest portion of Montgomery's debt stems from a failed restaurant investment he entered into with his wife, Tracy Nunan. Eddie Montgomery's Steakhouse closed last May and will be sold to repay creditors later in the month.

According to news reports, the proceeds from the sale of the steakhouse will be used to pay back nearly $13 million in debt owed to the Central Bank & Trust of Lexington. Also for sale is a 273 acres house that Montgomery co-owns with his ex-wife. In a statement issued by Montgomery's attorney, the attorney cites Montgomery's recent divorce and difficulties with the restaurant as the primary causes for Montgomery's Chapter 7 bankruptcy filing.

Chapter 7 bankruptcy allows consumers to extinguish debt and obtain the fresh start they crave. However, to file for Chapter 7 bankruptcy consumers must qualify. This means that the consumer must meet certain income limitations. If a consumer qualifies for Chapter 7 relief, their debt may be discharged in exchange for giving up certain, nonexempt property to repay creditors. While a consumer may lose some property in Chapter 7, the benefits far outweigh the negatives.

There are options for individuals and families to alleviate debt and start fresh. It is important that they are aware of their options so they can take appropriate actions.

Source: Lexington Herald, "Country singer Eddie Montgomery files for bankruptcy," Janet Patton, Jan. 02, 2014

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Mark T. Young & Associates
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Hixson, TN 37343

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