Debt trouble takes many forms. Foreclosures, loan modifications, ballooning credit card debt, repossessions, creditor harassment, tax collectors. Often it is important to act before it is too late. Contact a Minnesota bankruptcy attorney today! Call us at 651-639-0313 for a free phone consultation.
Timing is very important in bankruptcy. In some cases, the month you choose to file may be very important. There are certain debts that you should not pay if you think you may file bankruptcy soon.
Competent, affordable legal advice is a must. Twin City Attorneys has filed over 1,500 bankruptcy cases. Our wealth of experience means our Minnesota bankruptcy attorney staff has seen many unusual financial situations before. You will not pay a high hourly fee for a lawyer to get on the job training.
Bankruptcy is not a recent invention. The Constitution authorizes Congress to pass “uniform laws on the subject of Bankruptcies.” Congress has established a system of federal courts to administer the bankruptcy law. Judges have been appointed for 90 bankruptcy districts throughout the country. Each state contains at least one district.
The goal of the bankruptcy laws passed by Congress is to give debtors a fresh start. As the U.S. Supreme Court said, “It gives to the honest but unfortunate debtor…a new opportunity in life and a clear field for future effort, unhampered by the pressure and discouragement of preexisting debt.”
If you are facing financial issues, as so many Minnesota families are, and are considering bankruptcy it is important that you take action to prevent yourself from becoming overwhelmed. The Minnesota bankruptcy attorneys at Twin City Attorneys are advocates who are committed to helping our Minnesota clients get out of financial trouble.
Having handled over 1500 bankruptcy cases in Minnesota under the bankruptcy laws, both new and old, our lawyer staff is experienced in advising you of your options for filing for bankruptcy.
There are 6 types of bankruptcy
Both individuals and business entities such as corporations and limited liability companies may file a Chapter 7 or Chapter 11 bankruptcy. Only individuals with unsecured debts of less than $383,175 and secured debt of less than $1,149,525 can file a Chapter 13 bankruptcy case. Only family farmers and family fishermen may file a Chapter 12 case. Only municipalities such as cities, towns, villages, counties and school districts can file Chapter 9. Chapter 15 is designed to resolve cross border insolvency issues involving claims or assets in both the United States and at least one other country.
Chapter 7 Bankruptcy is sometimes called a liquidation bankruptcy. The debtor is allowed to keep certain “exempt” assets. Most debtors, but not all, lose no assets as part of their case. If assets remain to be distributed from the debtor’s estate, the trustee liquidates the assets (reduces them to cash) and distributes the proceeds to creditors who file a “proof of claim” with the bankruptcy court. Many debtors prefer a Chapter 7 filing because their case is resolved more quickly and because they often will not have to make any payments to the trustee. The trustee may object to filings from debtors with high enough incomes to be able to pay a significant part of their debt in a Chapter 13.
Chapter 13 Bankruptcy is designed to ‘adjust’ the debts of a debtor with regular income. The debtor proposes a plan to repay part or all of the debtor’s debts. The plan normally consists of 36 to 60 payments over 3 to 5 years and must be “confirmed” by the court. Many debtors prefer to file a Chapter 13 case because they may be able to keep more property or may want time to repay a creditor for an assortment of reasons. Also, a Chapter 13 can protect co-signers to some degree and can discharge some debts which can not be discharged in a Chapter 7 case.
Chapter 13 can “strip off” a mortgage if there is no value in the real estate to support the mortgage. A lien on a car or other personal property may be “crammed down” to the value of the car or the interest on the car loan can sometimes be reduced. In some cases, a debtor may not be permitted to use Chapter 7 because the debtor’s income is considered high enough to afford payment of a significant part of the total debt in a Chapter 13.
Chapter 12 Bankruptcy ‘adjusts’ the debts of a family farmer or fisherman with regular income. This Chapter is designed to keep a farmer or fisherman in business while the plan is carried out. This Chapter is much like a Chapter 13 in that a plan is proposed to make regular payments to the trustee. The plan generally does not last longer than 3 years unless the debtor proposes a longer period not to exceed 5 years. Debtors have some additional powers of a trustee in a Chapter 12.
Chapter 11 Bankruptcy was designed to reorganize a commercial enterprise. However, changes to the Bankruptcy Code in 2005 makes this Chapter useful to many individual debtors. For individuals, a Chapter 11 functions like an expensive, supercharged Chapter 13. The object is often to continue to operate a business while repaying creditors through the plan of reorganization. The debtor has a 120 day exclusivity period in which to propose its plan. The debtor can use the plan to pay some creditors and to discharge the debts of others. Chapter 11 cases are often used to free the debtor from burdensome contracts or leases. The “debtor in possession” has most of the powers of a trustee. These powers can be used to recover property and pursue claims to aid the reorganization.
Chapter 9 Bankruptcy ‘adjusts’ the debts of municipalities. While similar in several ways to a Chapter 11 or Chapter 12 Bankruptcy, Chapter 9 is unique. Due to the fact that municipalities are entities of State Governments their power to adjust their debts through Bankruptcy is limited by the 10th and 11th Amendments.
Chapter 15 Bankruptcy provides a mechanism to deal with insolvent debtors with business problems that stretch across international borders.
Related Minnesota Bankruptcy Matters
In addition to our lawyer staff handling Chapter 13 and Chapter 7 bankruptcy filings, Twin City Attorneys can assist clients that are facing a range of issues that are related to Minnesota bankruptcy. Some of the other matters on which our lawyer staff can advise include:
To learn more about filing for bankruptcy in Minnesota or gaining other financial relief, contact us today. We will have a bankruptcy lawyer devise a plan to deal with your financial difficulties. Call us at 651-639-0313 for a free phone consultation.