Posted on March 02, 2013 in Chapter 7

Many people often falsely believe that a bankruptcy filing means the person is a spendthrift who can’t take care of his or her finances. However, in truth, most people file for bankruptcy for completely different reasons. An article in U.S. News Money mentions several misconceptions surrounding consumer bankruptcy. Here are some of them.

1. People who file for bankruptcy are irresponsible when it comes to money. In truth, some of the most common causes for consumer bankruptcy are long-term unemployment, expensive divorces and the cost of medical care. According to a 2011 survey by the Centers for Disease Control and Prevention, 20 percent of American households had difficulties paying medical bills.

2. Bankruptcy discharges all of your past debts. Not all types of debt are discharged by bankruptcy. Domestic support obligations, for example child support, can’t be removed no matter what. The same is true for restitution for a crime, and tax debts can’t be removed if you have not filed tax returns.

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 Posted on February 26, 2013 in Chapter 7

According to Casey Anthony, the infamous mother of Caylee Anthony, she owes about $80,000 to various creditors and almost $500,000 to her defense attorney. Because of this, she has now filed for Chapter 7 bankruptcy in federal court.

This article from KHOU, a CBS-affiliated station in Houston, Texas, shows that filing for bankruptcy also allows all lawsuits against Anthony to be frozen—including the one filed by Texas Equusearch.

Equusearch, a non-profit organization, helps police look for missing persons. In the case of Caylee Anthony, they spent about $119,000 on the search, and enlisted over 4,200 volunteers from all over the country. The lawsuit claims that no matter the truth in Caylee’s death (the defense claimed she drowned in a pool and the parents covered it up; prosecutors said Anthony murdered her with chloroform), Anthony knew her daughter was dead—the search never would have happened with this knowledge.

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