Tough times can fall on anyone. No one knows that better than a formerly successful rapper who has found himself deeply in debt and is now in the midst of a Chapter 7 bankruptcy. Chapter 7 bankruptcy involves the liquidation of assets in order to pay off creditors as much as possible, although some assets such as a modest home and vehicle are excluded from liquidation.
In order to file, one must pass a means test and prove their income is below the median income for their state. As a result, most bills, including credit card bills and medical bills are forgiven, leaving the filer with a fresh start. Although the Chapter 7 filing takes time, the filing alone stops creditor harassment and prevents devastating events such as foreclosure or eviction.
For many, liquidating assets is a small price to pay in order to be free of debt. But for this rapper, having to sell his name as part of the process is a hard pill to swallow. Since his performance name is under trademark, it is considered a possession and must be sold. The experience has left the rapper torn, since he has been using the name since he was a boy.
Although most of our names don’t carry a trademark and can’t be put up for sale, there may be other possessions we own such as family heirlooms that the court can order be liquidated as part of a Chapter 7 bankruptcy. For those considering Chapter 7 bankruptcy as a solution, it is important to get a good understanding at the beginning of the process to keep from losing something invaluable.
BlackBook: “Young Buck May Have to Sell His Name To Pay Off Debts,” Nick Greene, Dec. 28, 2011