Last February 2015, David Cassidy announced that he is going through bankruptcy proceedings. The former Partridge family star stated that he needed this “to reorganize my life as I go through divorce and to restructure my finances.” Cassidy’s bankruptcy filing came just about a year after being arrested for his third drunken driving charge last January 2014 that lead to his subsequent divorce from long-time wife Sue Shifrin-Cassidy.
The latest development in his case, however, is that he was recently ordered by the court to sell his home in South Florida. The house, which will be sold through Fisher Auction Co., has six bedrooms, six bathrooms, a large pool and a magnificent kitchen. So if you are interested in owning a grand celebrity home, this may be your chance.
More than Chapter 7
What is interesting about David Cassidy’s case is that he filed for Chapter 11 instead of the usual Chapter 7 or 13 bankruptcy. Most people think of Chapter 11 bankruptcy as a way for businesses to reorganize and restructure their debts while continuing to operate. But in many cases, individuals also file for Chapter 11. It usually happens when the person filing for bankruptcy has secured or unsecured debts that exceed the limits imposed by Chapter 13, and also cannot pass the means test for Chapter 7.
In the case of Mr. Cassidy, he reportedly has assets amounting up to $10 million. Problem is that he has about the same number of debts:
- $39,000 in credit card debt
- $292,000 in mortgage debt
- $131,000 in lawyer’s fees
- Large medical debts
- Massive accounting debts.
On top of all this, he’s also currently embroiled in a legal dispute related to several thoroughbred horses that he co-owns.
Bankruptcy Can Help
It is an unfortunate turn of events for one of the original teen kings of Hollywood, but the truth is that he may very well rebound from this better than ever. While bankruptcy has a bad reputation when reported in the media, it is actually a powerful legal tool that can help get someone back on their feet.
If you don’t believe it, you can just read these names: Burt Reynolds, MC Hammer, Kate Basinger, Toni Braxton, Sinbad, Mike Tyson, and even the great Larry King. What do they have in common? They all filed for bankruptcy at one point in their lives. Do they fit the image of the standard person who files for bankruptcy? Of course not, they’re still celebrities and are still more financially stable than most Americans.
A lot of them spent more than they were actually earning because it felt like their fame could sustain their lavish lifestyle. However, when debts keep rising and the money was no longer enough to keep up, they, like others in their situation, finally learned their lesson. They go through bankruptcy to either eliminate bad debts or to restructure their repayment plans so that they can start a new life.
With the hard lessons of bankruptcy in tow, all people—not just celebrities—can get out of a bad situation, not only in better financial shape than expected, but also as wiser, and hopefully more compassionate people. If you want to use bankruptcy to turn over a new leaf, gather up all your information relating to income, debts, and assets, and get in touch with a skilled bankruptcy lawyer in your area.