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Why did Vince Young file for Chapter 11 bankruptcy?

Washington, D.C., residents who have been following the Vince Young bankruptcy case may wonder why he was able to file under Chapter 11, which is also used for some corporate bankruptcy. Although most individual cases are filed under Chapter 7 or Chapter 13 of the bankruptcy code, Chapter 11 is also available under certain circumstance. Chapter 11 also provides certain advantages for personal bankruptcy filers.

Young, an National Football League star, may have settled on Chapter 11 filing so he can reorganize his finances without employing a court-ordered trustee. Debtors are still able to object to any proposed reorganization plan. Further, Young's estate could be too large to file under Chapter 13. If he had chosen Chapter 7, furthermore, he would lose the ability to control which assets might be liquidated to repay lenders. In liquidation, Young might lose certain assets that he wanted to retain.

Chapter 11 as a personal bankruptcy option does have some disadvantages. Young's future earnings will be overseen by a bankruptcy court, for example. Further, his spending can be limited directly by court order. A judge has already enforced a monthly spending limit for the pro, who reportedly owed money through settlements to his former financial adviser and a loan company known as Pro Player Funding.

Those Washington-area residents who are interested in learning more about bankruptcy might want to inquire about the benefits and drawbacks of filing for personal bankruptcy under Chapter 11. Those who are looking for credit repair opportunities through bankruptcy may benefit from a consultation with a qualified area attorney. These professionals can provide education and advice, helping filers decide which bankruptcy chapter would be best for their personal needs.

Source: Houston Chronicle, "Lawyer speculates on strategy behind Vince Young’s Chapter 11 bankruptcy filing" David Barron, Jan. 23, 2014

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