On Tuesday, we reported that Natalie Hawkins, the mother of gymnast Gabby Douglas, filed for Chapter 13 bankruptcy prior to the London Olympics. However, Hawkins isn't the only parent who's faced financial hardships in the years leading up to the Olympics.
Steven and Ileana Lochte, parents of swimmer Ryan Lochte, are behind on their mortgage payments and facing foreclosure. It's probably no coincidence that two of the Olympics' biggest stars happen to have parents with serious financial woes. But what's causing the parents of Olympians to go broke?
In a word: preparation. Training for the Olympics is a full-time job that requires years of dedication. It also costs money. A lot of it.
Training expenses can include a travel, practice facilities, living costs,a and a coach's salary. Those can add up to over $100,000, according to Eric Flaim, a medalist in speed-skating. And that's not counting any lost earnings the athletes or their parents may incur as a result of the constant travel, U.S. News writes.
For young athletes training for their first Olympics, like 16-year-old Douglas, parents are left to foot the bill. Hawkins, Douglas' Mom, has opened up to reporters about the high cost of her daughter's training and the effect it has had on her finances. In January, Hawkins filed for Chapter 13 bankruptcy in order to save her home from foreclosure.
Steven and Ileana Lochte are in the same boat. In May, CitiMortgage filed a lawsuit against the Lochtes, claiming they hadn't paid their mortgage since February 2011, write NY Daily News. The Lochtes reportedly owe $242,239 plus interest on their mortage. CitiMortgage hopes to foreclose on the home.
The Lochtes could take a page out of Hawkins' playbook and file for Chapter 13 bankruptcy. In many cases, filing for a Chapter 13 will permanently stop a foreclosure, allowing the debtor to pay back the missed payments according to his or her bankruptcy repayment plan.
With Ryan Lochte's performance in the London Games, bankruptcy may no longer be necessary for Steven and Ileana Lochte. Gabby Douglas and Lochte' success in the summer games shows that sometimes the financial sacrifices that come with training for the Olympics can pay off.
- Gabby Douglas, Ryan Lochte: Why Families of America's Olympics Athletes Are Broke (The Daily Beast)
- Filing for Chapter 13 (FindLaw)
- 10 Tips to Avoid Foreclosure (FindLaw)
- Top 5 Reasons Why NFL Players Go Bankrupt (FindLaw's Phoenix Bankruptcy Law Blog)