Broke to Bankrupt
Does my faith let me file?
Introduction
1. Basedonwhatyouknow,whatdoesitmeanthatapersonhas“filedfor bankruptcy”?
2. Basedonthatdefinition,whatisyourviewonwhetheraChristianshould everdoit?
Debt and Bankruptcy as a Moral Issue
Proverbs 22:7
A rich person rules over poor people, and a borrower is a slave to a lender.
Proverbs 22:26,27
Do not be among those who shake hands to guarantee debts.
27 If you do not have enough to repay, why should your bed be taken out from under you?
1. WhatwarningdoesScripturegiveregardinggoingintodebt?
Psalm 37:21
The wicked borrow and do not repay, but the righteous are gracious and give.
Romans 13:8
Do not owe anyone anything except to love one another, for the one who loves another has fulfilled the law.
2. Ifwedogointodebt,whatdoesGodexpectustodo?
Leviticus 25:35-38
When your fellow Israelite becomes so impoverished that he cannot support himself, help him as you would help a resident alien or a temporary resident. Let him retain his right to work for a livelihood among you. 36 You shall not take advance interest or accrued interest from him, but you shall fear your God and let your brother retain his livelihood with you. 37 You shall not lend him your money for advance interest or your food for accrued interest. 38 I am the Lord your God, who freed you from the land of Egypt to give you the land of Canaan and to be your God.
3. Godalsohadinstructionsforhispeopleaboutlending.WhydidGodalso needtogiveinstructionstothelender?
4. SummarizeGod’sinstructions.
5. Respondtothisstatement:BecauseGodtellsustorepayourdebts,a Christianshouldneverfileforbankruptcy.Ifyoudisagree,whataresome specialcircumstancesthatyoubelievewouldjustifyit?
6. Reacttothefollowingstatementbothfromtheperspectiveofthedebtorand thecreditor:ThewayunpayabledebtsowedtoChristiansaredealtwith shouldbedifferentfromotherdebts.
7. Discussthisstatementbothfromtheperspectiveofthedebtorandthe creditor:Thewayunpayabledebtsowedtofamilymembersaredealtwith shouldbedifferentfromotherdebts.
Debt and Bankruptcy as a Financial Issue
1. UnitedStatesbankruptcycodesareextensive.Asageneralrule,anindividual consumer(asopposedtoabusinessormunicipality)mayfileforoneoftwo typesofbankruptcy:
Chapter Bankruptcy
• Recentbankruptcycoderevisionshavemadeitmoredifficultfor individualstofilethistypeofbankruptcy.
• Sometimesreferredtoastotalbankruptcy.
• Aperson’spossessionsaresold(exceptforcertainexemptitems).
• Attheendofthisliquidationprocess,thepersonmaybedischargedfrom someremainingdebts.
• Staysonaperson’screditreportfortenyears.
Chapter Bankruptcy
• Themorecommonformofindividualbankruptcy.
• Dependingonaperson’sincome,theyareputonamonthlypaymentplan thatgoestooutstandingdebtsforaperiodofthreetofiveyears.
• Attheendofthisprocess,thepersonmaybedischargedfromsome remainingdebts.
• Staysonaperson’screditreportforsevenyears.
2. What’syourresponsetothefollowingstatement?Bankruptcyshouldonlybe pursuedasanoption areallybadsolutiontoanevenworseproblem.
3. Otherthan(orbefore)filingforbankruptcy,namesomeotheroptionsthata personwithunpayabledebtscanpursue.
BONUS MATERIAL
A 2015 case of bankruptcy involves Family Christian Stores, the nation’s largest Christian bookstore chain. Apply the principles about bankruptcy discussed previously to the specifics of this situation. How should the parties conduct themselves based on the following factors?
1. FamilyChristianStoresisaChristianorganizationwhosebankruptcycaseis beingviewedandadministeredbynon-Christianpeople.
2. MuchofthedebtowedbyFamilyChristianStoresisowedtoChristian publishinghouses.
3. Evenwhilegoingthroughgreatfinancialdifficultyandaccumulatingunpaid bills,FamilyChristianStorescontinuedtodonatemoneytovariouscharities.
4. FamilyChristianStoreshasobligationsbothtoitsemployees,manyofwhom makearelativelymodestincome,andtoitsvendors,manyofwhomarevery wealthycompanies.