Readers in New Jersey may be interested to hear about the recent bankruptcy of a mayor of a small city in another state. It typifies the problems of many individuals and families across the country. The mayor filed for Chapter 7 bankruptcy after suffering economic difficulties brought on by the continuing national recession. In addition to serving his city, he has worked as a real estate developer in the past.
In his Chapter 7 bankruptcy filing, the mayor itemized some $10.8 million in debts. These financial obligations include the mortgage on his personal home and another lot, money to the private school that his child attends and a loan from a local bank. Unsecured loans may be discharged at the end of the Chapter 7 process. However, taxes that he owes and secured loans such as mortgages will likely not be subject to discharge as a result of the liquidation bankruptcy.
The mayor says that he has $1.4 million in assets. Like those of us in New Jersey in a similar situation, he will seek to protect as many of his assets as possible. This can be achieved by using exemptions that are detailed in each state.
Filing for Chapter 7 bankruptcy can initially seem intimidating. The petition must be prepared correctly, including a detailed schedule of assets and liabilities. Nevertheless, the financial relief gained during the process can benefit people who have suffered economically during the past few years. In addition, once unsecured debts are discharged, many find that they are able to begin a fresh financial future free from the debts that were weighing them down.
Source: Winston-Salem Journal, “Greensboro mayor is $10.8 million in debt, bankruptcy records show,” Amanda Lehmert, April 9, 2013