Bankruptcy Options Which One Is Best For Me.

Most people who are thinking about filing for bankruptcy wonder which options is best for me. The choice on what type of bankruptcy file can be confusing considering the choices available. The most common type of consumer bankruptcy filings are chapter 7 bankruptcy and chapter 13 bankruptcy. If you have a small business and want to reorganize you may look at a chapter 11 bankruptcy.
The most common type of bankruptcy is a chapter 7 bankruptcy and for most people involves keeping your exempt assets, and shedding your unsecured debts. The most common type of bankruptcy is a no asset bankruptcy. In this type of chapter 7 bankruptcy your creditors will not get paid anything from your assets. The other type of chapter 7 case is an asset bankruptcy. In this type of bankruptcy creditors will be paid back from money collected from the bankruptcy estate. In Minnesota the most common reason for assets being available to the bankruptcy estate are using the Minnesota State Exemptions when filing.
The next most common type of bankruptcy in Minnesota is a chapter 13 bankruptcy. This is a bankruptcy that allows you to pay back your debt over the next 36 to 60 months. The difference in payment terms depends upon your income. If you income is above the median income you can do a 60 month payment plan, if you income is below the median you can do a 36 month plan. This type of bankruptcy works well if you have debt that cannot be discharged in a chapter 7 bankruptcy. Or if you have assets that you do not want liquidated in a chapter 7 bankruptcy. The chapter 13 bankruptcy option is a far better option for most people than debt consolidation. The chapter 13 allows all of your debt to be rolled into one payment that you make monthly. It stops all the interest on the debt and stops all collection activity.
If you are stressed out from debt that you know you cannot pay back, or if you have wage garnishments or bank levys, you need to talk to an attorney to determine if bankruptcy is a good option for you. In most cases the longer you wait to consult a bankruptcy lawyer the worse the debt becomes.

Bankruptcy Laws In Minnesota

If you are filing for bankruptcy the rules are governed by the Federal Bankruptcy Laws. State laws may affect your bankruptcy filing for several reasons, the main reason being if you need to use the Minnesota exemptions. The primary reason or using the Minnesota exemptions are if you have equity in your homestead. The Minnesota homestead exemption currently allows you to use up to $360,000 to protect your home. You can also exempt retirement accounts for up to 1 million, using the federal exemptions. For most of our clients they will file using the federal bankruptcy exemptions.
I get asked on occasion is bankruptcy the right choice for me? The best answer is I do not know until I sit down and meet with the potential client to discuss all of the potential options. It is important to meet with you bankruptcy attorney to make sure that he or she understands your situation and can give you good advice. Bankruptcy law has a lot of traps that can cost clients money, so it is important to talk to your bankruptcy lawyer before making any repayments to friends or relatives.