Reed Law Firm, P.A. - bankruptcy

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A drop in income can be helped by bankruptcy in South Carolina

Finding a fulfilling job that provides extra income for a family can be difficult, but many women thought they found the ideal solution in Lularoe, a direct sales company. In South Carolina, the clothing company is mostly known for its brightly-patterned leggings, but many women who started selling them are now dealing with insurmountable debt. Since Jan. 2016, at least 24 people filed for bankruptcy -- both Chapter 7 and 13 -- citing Lularoe as at least one of the causes.

One of those women filed for bankruptcy in July 2017. She reported her annual income from 2016 as $61,330, all of which apparently came from operating her Lularoe clothing business. However, by 2017, she was only earning about $184 a month, and her income from Jan. to July 2017 was approximately $10,500, a significant decrease from 2016. Such a drastic drop in income made it nearly impossible for her to pay back her debts, which total over $85,000.

Another woman reported a similar drop when seeking bankruptcy protection. This woman earned $15,000 with Lularoe in 2015 and only $400 the following year. By 2017, her profits dropped to zero. Her debts -- including student loans of $31,700 and thousands owed to credit cards -- might have been especially difficult after experiencing such a decrease in income.

Virtually anyone, whether employed in a salaried position, self-employed or working in direct sales, can experience a sudden and unexpected decrease in income. Even the best prepared people in South Carolina can be caught off guard, and debt can suddenly spiral out of control. However, most can find secure financial footing by pursuing protection through Chapter 7 or 13 bankruptcy.

Source: BuzzFeed, "At Least 24 Women Who Sold Lularoe Who Have Filed For Bankruptcy Since 2016", Stephanie McNeal, Nov. 6, 2017

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