Started over after bankruptcySeveral debts$86,500
Filing Chapter 7 on $86,500 of Debt: What One Filer Learned Seven Years On
Jay Swanson grew up believing bankruptcy was shameful, then found himself owing $86,500 on about $2,000 a month. He filed Chapter 7 in 2017 and reflects on how he got there and what changed afterwards.
Video by Jay SwansonPublished February 7, 2025Breakdown updated September 15, 2026
Key moments
“How Declaring Bankruptcy Changed My Life” by Jay Swanson. We didn't make this video; it loads from YouTube when you press play.
Where Jay started
Jay says that by 2017 he owed $86,500, not counting $33,000 in student loans. Years of carrying consulting travel costs on credit cards, plus money he put into books, Kickstarter campaigns and a tech startup that failed, had piled up. Working as a bike tour guide in Paris, he earned $2,013 a month, less than he owed his creditors each month.
What Jay did
- 1
For years he kept paying and put off bankruptcy, held back by pride, shame and worry that it could hurt his plans to live in France.
- 2
When the tourist season slowed and he could no longer cover his payments, he found a bankruptcy lawyer willing to work with him from abroad.
- 3
He listed everything he owned for the case; the total value was $2,695.
- 4
He flew back to the US for an in-person appearance where he had to confirm his identity.
- 5
He filed on November 8, 2017, and his debts were discharged on February 7, 2018.
What you can learn from it
Shame delayed his filing for years
Jay says pride, shame and fear kept him paying debts he couldn't afford long after a friend urged him to consider bankruptcy. Talking options through with a bankruptcy attorney early can make the decision clearer, whatever it turns out to be.
Credit counseling comes before filing
Individuals must get credit counseling from an approved agency within 180 days before filing. With limited exceptions, filers also have to finish a separate debtor education course after filing to receive a discharge.
Exemptions shape what property is kept
Chapter 7 involves selling a debtor's nonexempt property to pay creditors. Jay's listed property was worth $2,695, so little was at stake; whether a given item is exempt is often a question of state law.
Student loans are treated differently
Jay's $86,500 figure didn't include his $33,000 in student loans, and the video doesn't say what happened to them. Federal bankruptcy law excepts most education loans from discharge unless repaying them would impose an undue hardship.
Credit reports can show it for 10 years
Jay describes bankruptcy as a seven-year mark on his record. Federal law allows consumer reports to include a bankruptcy case for up to 10 years from the order for relief.
In their words
“Bankruptcy, the way I was raised is a filthy word and something that only quitters would ever do”
Before you copy this path
Jay had very few assets, a low income and a rent-free place to live abroad, and he says some details are hazy years later. Whether Chapter 7 fits another situation depends on income, property and state law, which is a decision to work through with a bankruptcy attorney.
Watch out: It stays on your credit report for years and doesn't erase every kind of debt.
Learn how bankruptcy worksCommon questions
How long does Chapter 7 bankruptcy take?
The trustee holds a meeting of creditors 21 to 40 days after filing, and the court generally issues a discharge 60 to 90 days after the date first set for that meeting. Jay filed on November 8, 2017, and was discharged on February 7, 2018.
Source: uscourts.govCan student loans be discharged in Chapter 7 bankruptcy?
Generally not. Federal law excepts government-backed and qualified education loans from discharge unless repaying them would impose an undue hardship on the debtor and the debtor's dependents.
Source: law.cornell.eduHow long does bankruptcy stay on a credit report?
Under the Fair Credit Reporting Act, a consumer report can't include a bankruptcy case that dates back more than 10 years from the order for relief.
Source: law.cornell.eduSources
By DebtCheckUSAEditorial Team. This is our summary of a video we didn't make, and nobody paid us to include it. It's one person's experience, not financial, tax or legal advice. Advertiser disclosure
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