The 45-year-old looked very emotional as she recalled how being sectioned in 2011 worsened her financial troubles.
"You can't pay your bills because a doctor's looking after you," she said. "Well, actually they didn't at any point."
Gail was declared bankrupt by the High Court Of Justice last week, and has since revealed that at her lowest point, battling debt and depression, she was homeless for over a year, forcing her to spend several nights sleeping rough on a park bench.
When the panel asked about recent revelations about her homelessness, Gail explained: "I couldn't afford anywhere so I just hung out on a bench on Hampstead Heath."
Gail Porter broke down in tears discussing her bankruptcy with the Loose Women panel
Gail looked very emotional as she opened up about her struggle with debt on the ITV chat show
Loose Women confessions
Tue, November 1, 2016
The candid Loose Women panelist are always shocking us with their confessions. Here are some of the best revelations.
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Linda Robson claimed that Joe Swash, Stacey Solomans's boyfriend, lost his virginity at her house
Speaking about her descent into debt, the former FHM favourite admitted: "The bills kept coming in and I'd had a breakdown and I'd lost my mum. So I put them under a pillow.
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"My problem was I ran away from everything and when you run away from things they just get worse."
"When you become bankrupt, it's common knowledge," she said, trying to compose herself.
"So I wanted to say, I'm not Donald Trump, I don't spend millions and then go bankrupt."
When the ex-Top of the Pops presenter cried as she spoke about how public being declared bankrupt was, Stacey Solomon comforted her, saying: "There's nothing to be ashamed about whether it's public or not."
Viewers took to Twitter to slam Loose Women for their treatment of Gail
Loose Women appeared to cut Gail short in the middle of her emotional story
Viewers have taken to Twitter to slam the ITV chat show for cutting Gail off, saying it was "how NOT to treat someone with mental health issues".
Gail appeared on Loose Women last year after undergoing a dramatic breast reduction, going from a 28JJ to a C cup, saying that the surgery had made her the happiest she had ever been.
She also discussed how her breast size had resulted in extreme back pain and caused her to develop anorexia in an attempt to minimise them.
The mother-of-one made her name in the 1990s as a lads' mag pin-up and TV presenter, but has since struggled with debt after she lost her modelling and TV work due to alopecia.