Why File Chapter 7?
People run into financial problems for many different reasons like job loss, divorce, diminished income, or costly medical bills. Sometimes it can seem like there’s no way out. But declaring bankruptcy might provide the right solution for you to recover from these events.
Depending on your situation, different types of bankruptcy may be more appropriate. Chapters 7 and 13 are two of the most frequently used options because they usually offer the most help to individuals. Chapter 13 involves working out a payment plan that takes 3 – 5 years to complete. If you are filing for bankruptcy in Minnesota, have limited income, and want to get out of debt fast, Chapter 7 may be the best choice for you.
Advantages of Chapter 7 Bankruptcy
Here are some of the many advantages of declaring Chapter 7 bankruptcy:
- A fresh start: Once you file for Chapter 7 bankruptcy in Minnesota, collection agencies and creditors must stop hounding you for payment. That means no more phone calls or letters. If your wages were garnished, the garnishment immediately stops. In addition, foreclosure proceedings are paused. If you can bring your mortgage payments up to date during the foreclosure delay, you will probably even be able to hold onto your home.
- Discharge of debt: If you qualify for Chapter 7 relief, you will not be required to create a repayment plan because your eligible debt will have been discharged, or wiped out. This is the case regardless of how much debt you were in.
- Future income: With very few exceptions, you will be able to keep your future income (for example, if you become entitled to inherit something within 180 days of your case filing date, it might be counted towards your assets for the purposes of the bankruptcy court).
- Speed: Some cases are resolved in as little as three months. After the case’s conclusion, you will also be able to get lines of credit again.
Chapter 7 bankruptcy is also referred to as liquidation bankruptcy, which means that it is important that you find out which of your assets can be exempted, or protected, in going through the bankruptcy process. Assets that cannot be exempted must be turned over to the court for the benefit of your creditors unless you pay the court the value of those assets. In many cases, that’s a relatively small price to pay for financial freedom and emotional well-being.
An experienced Minnesota bankruptcy attorney can help guide you towards a brighter financial future through declaring Chapter 7 bankruptcy.
Contact Our Knowledgeable Bankruptcy Attorneys in the Twin Cities
At Martin & Hedervare PLLC, we have years of successful experience helping Minnesotans like you get out of crippling debt. Our attorneys are available to help clients in the Twin Cities, Minneapolis, and St. Paul communities. Contact us at (651) 383-4725 to schedule a consultation today.