Financial challenges can happen to anyone in New York and across the country. Even those who seemingly had it all with major paychecks, fame and a prominent lifestyle are vulnerable to financial realities and must consider alternatives such as filing for bankruptcy if they are no longer able to make their payments and the debt turns into an endless cycle. For any debtor who has reached the point where it is necessary to find a way to get back on stronger financial ground, it is wise to consider bankruptcy.
The former Major League Baseball pitcher Livan Hernandez has filed for Chapter 13 bankruptcy. After defecting from Cuba to the U.S., Mr. Hernandez played 17 seasons in the majors and earned slightly more than $53 million in contracts during his playing career. The case was filed in Florida. It is early in the process, but he claims to owe up to $1 million and has up to 50 creditors. According to the filing, many of his debts are consumer-based to various businesses and credit card companies. He also owes a local businessman $220,000 that was said to be a loan and was never repaid.
Chapter 13 is not a liquidation bankruptcy and will allow a person to repay the debts he or she owes within a certain time frame of three to five years. Referred to as a “wage-earner” bankruptcy, this process can help a person clear debt and end various forms of harassment that creditors will use to try to get what they are owed. Chapter 13 can protect assets that are not exempt in a bankruptcy such as vehicles worth more than $4,000, bank accounts, investment property and jewelry. These would be liquidated in a Chapter 7.
While it might seem unusual for a person who earned the amount of money that Mr. Hernandez did to need to file for bankruptcy, it is not. Nor is it anything to be embarrassed about. People can get into financial trouble for a variety of reasons and for their peace of mind and the future, bankruptcy is a reasonable way out. Speaking to a lawyer who is experienced in all forms of debt relief is the first call that should be made when thinking about improving one’s financial situation with bankruptcy.
Source: miamiherald.com, “He was a World Series hero for the Marlins, and now he’s bankrupt,” Jose Lambiet, July 10, 2017