Recently, I came across a set of circumstances that left me baffled. LifeBack Law Firm chose to represent bankruptcy clients where the clients had an original attorney of record who refused to complete their representation in bankruptcy. LifeBack Law would never leave a client stranded and left to their own devices. And yet, this original attorney of record did exactly that. She left the clients dangling even the though she is and still is the client’s original attorney of record.

The word “bankrupt” come from the Italian words, “banca rotta”, which means “broken bench”. In Italy, money dealers worked from benches or tables. If a dealer ran out of money, his bench was broken in half and he was out of business.  

What is a Chapter 7 Bankruptcy anyway? Will I lose everything I own if I file bankruptcy? Will the bankruptcy law firms in my area treat me with the dignity I deserve? When you are suffering from debt, many things cross your mind. One of them is will I lose all my assets if I file Chapter 7 Bankruptcy? Chapter 7 Bankruptcy is referred to as a “fresh start” or “liquidation” bankruptcy where the focus is on the assets you own, wherever situated in the world, on the date you file bankruptcy.

Like any problem, the first step is admitting, I have a debt problem. I am not sick, my finances are sick. Once you get that far, you are well on your way to getting your life back. In St. Cloud, MN, we are a bankruptcy law firm right near where you live. If you are looking for a Chapter 7 Bankruptcy lawyer near you or a Chapter 13 Bankruptcy lawyer near you, LifeBack Law in St. Cloud is right in your back yard. We are locating at 13 7^th Avenue South, St. Cloud, MN 56301. We are located downtown St. Cloud on 7^th avenue south; right across the street from Capitol One Bank and a few doors down from Jets Pizza.

 I am not against any lawyer opening up a new law office or starting out from scratch. But, I am not a huge fan of having the lawyer start out on me, that’s all. There is something “unprofessional” about a bankruptcy lawyer answering his/her own phone with home noises in the background like dogs or cats or other household things. It just doesn’t feel professional at all. If I were the client, I would want a team of professionals helping me, not a lawyer answering his/her own phone.

It’s very common for people to be jointly liable for debt as co-signers. For example, students going to college often require their parents, or another adult, to be a co-signer in order to be approved for a student loan. People who do not have a great credit history may need someone to co-sign on other types of loans like home mortgages, car loans, or personal loans in order to be approved for financing. It’s also common for married couples to be jointly liable for other debts such as credit card and medical debt.

In a Chapter 13 bankruptcy case, the debtor must pay all of their disposable income towards their debts in a three to five-year repayment plan before their remaining debts are discharged. However, a bankruptcy discharge does not automatically erase creditors' lien on your property. Disposable income remains after paying the debtor’s normal monthly expenses. This differs from a chapter 7 bankruptcy case, in which the debtor is not required to make payments towards their debts before receiving a discharge a few months after their case is filed.

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 Job loss is a common reason that people file for bankruptcy. In many cases, when an individual loses their job, they are entitled to certain benefits to help them while they seek new employment. While these types of unemployment benefits are generally “exempt,” meaning legally protected from creditors, there are some exceptions and nuances in the law. Debtors filing for bankruptcy in Minnesota may choose between Federal exemptions and State exemptions to exempt, and protect, their property.

When a person files for chapter 7 bankruptcy, they are asking the court to discharge, or completely wipe out, their debts without having to make any payments to their creditors. Usually, all their debts are discharged, except for certain types of debts (i.e. student loan debt, most tax debt, and debt owed as alimony or child support). In order to qualify for a chapter 7 bankruptcy discharge, the debtor must be unable to afford making payments to their creditors, as they would have to do in a chapter 13 repayment plan.

Unlike a chapter 13 bankruptcy case in which the debtor makes payments to creditors in a three to five year payment plan before receiving a discharge, a chapter 7 requires no payments to any creditors, and involves a discharge a mere few months after the case is filed. However, while the debtor gets to keep all their property in a chapter 13 case, this is not always so in a chapter 7 case. In the majority of chapter 7 cases, the debtor gets to keep all their property due to the fact it is “exempt”, or legally protected from being taken to pay creditors. However, in some chapter 7 cases, the debtor has certain nonexempt property that they must either surrender to the trustee to be liquidated (sold with proceeds going to pay creditors) or, alternatively, must be paid for by the debtor for their right to keep the nonexempt property. Any money paid by the debtor to keep nonexempt property likewise goes to pay creditors.

Right now, there are hundreds of people in Eagan, Minnesota wondering how much it costs to file Chapter 7 Bankruptcy. Why do they wonder this? Because they are saddled with crippling debt and are looking to get their lives back.

It is that time of year, again. Tax filing season is upon us. If you find yourself in a Chapter 13 Bankruptcy in Minnesota, you may be wondering if you are able to keep your tax refunds. The answer to this question is determined by what your specific plan calls for. If your Chapter 13 plan is silent as to tax refunds, presumably you are allowed to retain possession of 100% of your tax refunds. However, if your plan has specific provisions dealing with excess tax refunds, you must comply with them.

When a person files for chapter 7 bankruptcy, they are allowed to claim certain property as “exempt,” or legally protected from creditors up to a certain value. Property that is exempt cannot be taken by the chapter 7 trustee to be used to pay the debtor’s creditors, whereas “nonexempt” property can be taken for that purpose. Minnesota allows debtors to elect either “State exemptions” or “Federal exemptions” to exempt, and protect, their property. The Federal exemptions are those specifically provided in the Federal Bankruptcy Code. State exemptions include any Minnesota State law, or applicable Federal law, not provided for in the Bankruptcy Code. Deciding whether to use State or Federal exemptions is complicated and better elaborated upon in other blogs. However, it is imperative that the debtor select the correct exemptions to use, as it often drastically impacts how much property they will be able to exempt. This is why it is also a good idea to discuss one’s potential bankruptcy case with an experienced bankruptcy attorney before filing one’s bankruptcy case.

LifeBack Law is your neighbor! LifeBack Law is Eagan’s favorite bankruptcy law firm and we are located near you in Eagan, Minnesota at 4480 Erin Drive, Eagan, MN 55122. If you are looking for Minnesota’s HIGHEST GOOGLE reviewed bankruptcy law firm, look no further than LifeBack Law Firm right near where you live. When Eagan, MN residents are suffering from overwhelming debt, they want a law firm whose staff pampers them and takes care of them, not a law firm whose staff is self-centered and could care less about you.

Are you an estate planning lawyer in Minnesota? I am not. I am the managing partner at LifeBack Law Firm, Minnesota’s largest bankruptcy law firm. And I am writing this article to highlight some issues we bankruptcy lawyers see often; including pitfalls and how to avoid them. When you meet with your estate planning clients, I suspect the subject of bankruptcy does not come up often. In other words, how is what you are doing with the client, in terms of estate planning, impacting a non-client heir who needs to file bankruptcy? 

Life is so humbling. Your best plans can go awry, quickly. I mean, who among us hopes when you get married, your marriage will be a failure? Who among us wishes for our business venture to turn into a disaster? Who among us hopes for an extended illness that costs tens of thousands of dollars and leaves us off work without pay? Nobody does this. We humans make elaborate plans and dream big dreams, and we should. However, life does not always play out the way you had planned it. I have accepted this broken road.