Some residents in Michigan suffer from financial problems. Despite their status, public figures could also endure these same troubles and require a debt relief process. When it comes to getting a fresh financial start filing bankruptcy might be the best option.
A state legislator from a state near Michigan and his wife has recently filed for a Chapter 7 bankruptcy in the wake of a failed business. The lawmaker and his wife declared that they owned around $122,000 in real estate and personal property, however, it was reported in their bankruptcy paperwork that they owed over $900,000.
Most of the lawmaker's debt appears to be related to business venture that did not materialize. Like many small business owners, in 2009 the legislator took out a loan from the Small Business Administration (SBA), a federal organization that helps provide financing to small businesses that those businesses might otherwise not be able to obtain.
The lawmaker's business was supposed to help parents find suitable day camps for their kids, but the idea apparently did not catch on. Several months ago, the legislator stopped making his monthly loan payment, and the SBA sued the couple because of the delinquent loan.
While it is noteworthy that a public figure like a state legislator has filed bankruptcy, Michigan residents should remember that many people from all walks of life find themselves in financial distress. Moreover, not all Chapter 7 bankruptcies stem from irresponsible spending or a preventable job loss.
Many times, would-be entrepreneurs fail in their first or even second attempts at starting a business. In addition to the emotional toll that a business failure can take on a person, it often spells financial disaster as well since the founder of an unsuccessful business usually has personally guaranteed repayment on the funds he or she obtains in order to start his or her business.
Usually, people who try and fail in a business venture should be given a second chance at a fresh start. Building one's own business is, after all, a part of the American Dream, and it is a good thing that Chapter 7 bankruptcy is available to protect those people who choose to pursue that Dream. Those considering this process should familiarize themselves with the steps involved. This can help give them a full financial picture of their situation.
Source: Minneapolis Star-Tribune, "$931,000 in debt, Republican Minnesota state Sen. Nienow files for bankruptcy," July 11, 2014.