Lefkovitz & Lefkovitz

Nashville Office 615-256-8300       Cookeville Office 931-400-2218

Nashville Office 615-256-8300
Cookeville Office 931-400-2218

Serving all of Middle Tennessee’s Bankruptcy Needs

  1. Home
  2.  » 
  3. Uncategorized
  4.  » Individuals can file for Chapter 11 bankruptcy, just like 50 Cent

Individuals can file for Chapter 11 bankruptcy, just like 50 Cent

On Behalf of | May 26, 2018 | Uncategorized |

Most people think of Chapter 11 bankruptcy as a corporate vehicle, a way for companies to reorganize their debts and stay in existence. But did you know that people can file under Chapter 11?

As rapper, entrepreneur and actor 50 Cent (officially known as Curtis Jackson) can attest, Chapter 11 bankruptcy can be advantageous for individuals in debt, particularly those with high assets. You may not be a multimillionaire, but you may be interested in learning more about lesser-known options for debt relief using the federal bankruptcy code.

Using Chapter 11 reorganization

According to USA Today, the hip hop star’s Chapter 11 case was discharged in 2017 after he made a payment of around $22 million. Originally filed in federal court in 2015, the petition contended that 50 Cent had $36 million in debt and only $20 million in assets. The court allowed him to set up a five-year payment plan, which he completed early.

In a more typical Chapter 11 case, an entity files to gain protection from creditors while being able to keep the business running, and a reorganization is permitted. Though the business remains subject to the court in certain ways, it is, in general, allowed to manage its own operations.

According to Wikipedia, the long list of companies that have used Chapter 11 include Delta Air Lines, the Chicago Cubs, Chrysler and Marvel Studios. All of them have survived (as of May 2018).

Chapter 7 and Chapter 13 are more commonplace

Most people who need bankruptcy protection to navigate a difficult financial time will use Chapter 7 of Chapter 13. A Chapter 7 “liquidation” subjects the filer to more scrutiny, but it allows them the chance to discharge — actually get rid of — certain debts like that from credit cards, medical bills, personal loans and more. A Chapter 13 can allow the filer to keep certain assets (such as a house or a vehicle) while setting up a manageable payment plan that will satisfy their creditors.

Every situation is different. If you feel like you are drowning in debt despite your best efforts, talk to an experienced attorney about whether bankruptcy could be helpful to you.

Photo of Professionals At Lefkovitz & Lefkovitz

RSS Feed

We help individuals and businesses find the right solution to their money problems.

Our Practice Areas

Debt Relief
Debt Management
Bankruptcy FAQs