Towanda Braxton Files for Bankruptcy with $150 in Her Bank Account
One of the stars of “Braxton Family Values” has filed for bankruptcy protection. According to Yahoo Entertainment, Towanda Braxton file for Chapter 7 bankruptcy protection earlier this month. Her court filings reveal that she has over half a million dollars in debt–$547,056.39 to be exact. Unfortunately, her assets only total about half that much, or $227,650. This is the very definition of being insolvent, so filing was probably in her best interest.
Other details from the bankruptcy filing will raise eyebrows:
- Towanda has a monthly income of $4,692 but expenses of $6,020. This state of affairs is clearly not sustainable, since she is going over $1,000 deeper into debt each month.
- Braxton owes her sister Tamar $35,000.
- Towanda’s assets include her Georgia home valued at $275,000. But the home has an astounding $417,715 mortgage, which means the house is underwater. Given the strong real estate market, it’s hard to understand how or why she borrowed so much money.
- She has no savings at all—zero dollars—and only has $150 in her checking account
- She owes a staggering $76,000 to a former landlord.
Braxton’s only income comes from her own business, T. Braxton Beauty Company.
Why Did Towanda Choose Chapter 7?
As a consumer, Towanda had her choice of two bankruptcies—Chapter 7 and Chapter 13. With a Chapter 7, she can hopefully wipe out most of her unsecured debts in a couple of months if all goes well. This means she won’t have to repay the personal loan her sister extended her. However, Towanda cannot wipe out her mortgage. That loan is backed by the house as security, and bankruptcy cannot wipe out the security interest.
Had Towanda chosen a Chapter 13, she would have needed to make monthly payments for 3-5 years to her creditors using whatever discretionary income she had. After completing the payment plan, any unpaid debts would get wiped (so long as they qualified for bankruptcy discharge). Not only is a Chapter 13 longer, but many people can’t keep up with the payment plan. It often makes more financial sense to file for Chapter 7.
Will Towanda Lose Her Home?
Probably. The home is badly underwater, meaning it is worth far less than her mortgage. She is ripe for being foreclosed on. Giving up the house might be Towanda’s best option. After the bank sells the house in an auction, they can probably come after her to make up the difference, called a deficiency judgment. Nevertheless, this is probably preferable to reaffirming her mortgage in bankruptcy and trying to pay off more than $400,000.
Struggling with Debt? We Can Help
Financial troubles can strike anyone—television celebrities and regular people alike. There are many reasons people get into trouble.
At Nowack & Olson, we offer guidance about how our clients can manage their debts. We are completely non-judgmental and will focus less on your past mistakes and more on how the law can help you going forward.
Reach out to us today. You can call 888-813-4737 to schedule a free initial consultation with one of our Plantation chapter 7 lawyers.
yahoo.com/entertainment/braxton-family-values-star-towanda-161554302.html
https://www.floridabankruptcynow.com/most-common-reasons-people-file-for-bankruptcy/
