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Football coach claims $40M in debts

Amended documents in a bankruptcy suit filed by a former college football coach show that the man is now claiming more than $40 million in debts. There has been a significant increase in the reported debt since his September filing, which claimed he had only about $26 million in liabilities along with about $1 million in assets. The man's Chapter 7 bankruptcy filing was amended in early October.

Legal information shows that the additional debts are attributable to $15 million that the man owes to Branch Banking & Trust in Louisville, Kentucky, where the man coached football during the late 1990s. Smith has also coached at Michigan State and other Midwestern schools.

The man and his wife have cashed in a series of life insurance and other policies in attempts to meet their financial obligations, but those efforts did little to address the monetary problems. Many of the man's financial difficulties have stemmed from his involvement in a Kentucky company that was formed to purchase loans that had been taken out from real estate investments. When the man was at Michigan State in 2006, he had gambled with those financial ventures, which eventually tanked along with the Louisville real estate market.

The man now coaches at Arkansas, where he has been hired for the season at $850,000. However, this 10-month contract is unlikely to make a dent in his sizable financial problems.

When people find themselves in debt which seems insurmountable, working with a qualified bankruptcy attorney can offer options that they may not have been aware of. Though most families will not find themselves in a situation as unique as Smith's, debt can easily outweigh income, and bankruptcy may be a solution to this financial crisis.

Source: Detroit Free Press, "John L. Smith's debt now up to $40 million," Brent Schrotenboer, Oct. 4, 2012.

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