In our experience, when someone decides to file bankruptcy they are taking the first step in a final solution to their debt problems. There are other alternatives to bankruptcy, but they act more like a Band-Aid than a solution. Choosing bankruptcy is an important personal decision, but too often people allow other’s misconceptions about bankruptcy prevent them from resolving their debt through bankruptcy.

There are many factors that can play into your decision to want to file bankruptcy. Oftentimes creditor harassment becomes too much to handle, or you come to the realization that you are in too far over your head and need some help finding a way out. Most of the time we encourage our clients to stop waiting and take action right away to get on the fast track to debt relief.

One of the most common fears when someone considers filing bankruptcy is that everyone will know about it. In reality, very few people other than your creditors or those you tell personally will ever know that you filed a bankruptcy case. Though bankruptcy filings are a matter of public record, it is not as easy to locate these records as it is to find other matters of public record, such as arrests, driving violations or real estate purchases. 

People from all walks of life can end up with financial struggles; no one is immune to financial crises and overwhelming debt. The events that unfold after falling behind on payments vary by case, but one common element that is involved in many cases is a mortgage payment. For many families, mortgages are one of the highest monthly payments they have, which makes it one of the first to fall behind on. I’ve asked James and Jean if I could share their story, to show you that financial trouble can occur at any time in your life – but this chapter in your life doesn’t need to end poorly.

We receive questions from clients about eliminating tax debts in bankruptcy on a regular basis. Owing the IRS is a frightening and frustrating experience because it can seem as if no matter how hard you try, you never get out from under your IRS debt. The interest and penalties alone can quickly add up to more than the actual tax debt, making it impossible for most individuals to pay it off. When dealing with the IRS becomes too overwhelming, people turn to us for help.

If creditors are threatening to take your property or money for a debt, you may want to ask a lawyer how you can stop lawsuits, garnishments, repossessions, foreclosures or other collection efforts.

A myth is an idea or belief that is believed by many people to be true when in reality the idea or belief is false. Myths can be harmful because they are passed from person to person until people begin to believe them without question. Bankruptcy myths can be especially harmful, because those who truly need the financial relief bankruptcy provides won’t even consider it as an option.

When you file a bankruptcy, the end goal is to receive a bankruptcy discharge (a.k.a. freedom from your debts). The bankruptcy discharge releases you from the legal liability to repay all debts that are discharged through your bankruptcy case. Post-bankruptcy-discharge your creditors are prohibited from attempting to collect discharged debts, including but not limited to contacting you to request payment of a discharged debt, filing or continuing a lawsuit or turning the debt over to a debt collector for collection.

Once you decide to consult with a bankruptcy law firm to discuss your options, some of the stress that you have been experiencing will start to diminish as you take a positive step toward resolving your financial problems. However, some of our clients feel overwhelmed by the legal terms that get used throughout the bankruptcy process.  During our initial consultations we explain everything in great detail, but below is a list of the most common legal terms used, for your reference.

An initial bankruptcy consultation should help you decide if bankruptcy is the right option for you based on an analysis done by an experienced bankruptcy attorney. If you schedule an initial bankruptcy consultation with our office, here are some of the things you can expect:

Getting out of debt is a top priority for many Americans today. Debt is a huge problem in our country and is causing many people to struggle financially. Debtors depend on a number of different solutions to help them get out of debt; some rely on the bankruptcy court while others are able to make changes to their budgets, get second jobs or refinance their debts.

When we meet with clients for the first time, if they are contemplating bankruptcy, we advise them to stop using their credit cards immediately. This is to avoid creditors filing adversary proceedings objecting to the discharge of particular debts. If you incur credit card debt close to the date of the bankruptcy filing, the creditor in question can file an objection with the court, alleging fraud on your behalf. These adversary proceedings will seek to exclude the purchases (i.e. the debt) from the discharge. If the creditor is successful, you will continue to owe the debt after your bankruptcy case is closed, even if you have received a discharge.

I strongly believe that a person should not fear losing his or her wedding ring due a debt. Wedding rings are a symbol of a couple’s union and should be preserved at all costs. As a bankruptcy lawyer and a citizen of Minnesota, I did not think that the existing laws (prior to 2005) were fair because they permitted creditors to take a person’s wedding ring to satisfy a debt; so, I decided to do something about it.

Lack of Protection for the Symbol of Marriage

Prior to the change in Minnesota exemption laws, a creditor could obtain a judgment against you that would allow them to seize your wedding ring to satisfy the debt you owed. Under Minnesota Statute 550.37, certain assets of a debtor are considered exempt. In other words, creditors cannot seize these assets from a debtor to pay the debtor’s debts. Under the old exemptions laws, a debtor’s wedding ring was not exempt. Creditors were able to seize your wedding rings, sell them and use the proceeds to pay the debt that you owed. Can you imagine owing a dentist bill for $300 and having your wedding ring seized and sold to pay for the debt?

Some people wondered why I was so passionate about working to change the exemption laws where wedding rings were concerned. To me, the prospect of losing a wedding ring to your creditors is despicable. I can understand losing a jet ski to your creditors to satisfy your debts, but not a wedding ring. A wedding ring is the symbol of marriage between two people.

Student loans are a serious debt problem for millions of Americans. Bankruptcy is designed to help provide relief for debtors who are struggling with overwhelming debt. However, in most cases, student loans are non-dischargeable in a bankruptcy proceeding. Debtors who desperately need assistance resolving their debt issues are not truly afforded a fresh start if a majority of their debt stems from student loans. This is why I am working to change the laws governing student loans in bankruptcy.

When you decide to file for bankruptcy relief, you are ready to hit the ground running. For most people, the weeks and months leading up to this decision are emotionally draining. Therefore, once you decide to meet with a bankruptcy attorney, you do not want to wait weeks or months for your case to be filed.

You see their ads on television, billboards and on every webpage related to debt relief - - the stereotypical “Big City” bankruptcy lawyer. They play on your emotions and promise you immediate relief from debt collectors and creditors. However, what they do not explain in their advertising is that they are more of a “mill” than a law firm. You are a file number and a retainer fee, rather than a real person with real financial problems. If you are considering bankruptcy, this doesn’t have to be your experience.

There are bankruptcy lawyers out there that treat you as an individual, with emotions and unideal financial circumstances. However, if you don’t go this route, you are at risk of succumbing to the dangers of choosing a stereotypical lawyer:

What are the Dangers of Choosing a Stereotypical Lawyer?

1. The biggest disadvantage of choosing one of these law firms is that the lawyer you meet with for your consultation may not be the lawyer that you see when you hire the firm (if you see a lawyer at all). You will be shuffled from lawyer to lawyer as you go through the bankruptcy process. Rather than having a bankruptcy lawyer that is familiar with your unique financial situation, you are placed with whatever lawyer has an open slot. You want a lawyer who takes the time to understand your situation and who is committed to helping you through this difficult time in your life. Our bankruptcy lawyers take the time to get to know each client so that we can make this process as stress-free as possible.
   
   
2. Many of these firms and lawyers have a pretentious demeanor. You may feel looked down upon, judged and intimidated when you meet with one of these lawyers. Rather than seeing you as an individual who needs help dealing with a serious financial crisis, these lawyers place blame for your financial situation squarely on your shoulders. It is our belief that most debtors are in this situation due to circumstances beyond their control, such as unemployment or a sudden illness. You need a bankruptcy lawyer who is going to be your partner in finding a resolution to your debt problems, rather than someone who is going to cause you to feel shame about your current financial situation. Unlike these firms, we understand this is a difficult and painful decision and we are here to give you the support, encouragement and guidance you need to solve your debt problems.
   
   
3. You are going to get the run around. Every time you call the law firm, you will speak to a different receptionist, then get transferred to a different assistant and maybe, if you are lucky, you will get to speak to a lawyer, but probably not the one assigned to your case. Again, these “Big City” law firms are not interested in helping you recover from a financial crisis. They only want to hurry you through the process so they can close your file and move on to the next paying customer. You are handed off to whoever is available at that moment, rather than being treated as an individual. Filing bankruptcy is a serious decision and you deserve to be treated with respect.
   
   
4. You become just another case filing to generate money for the law firm. The lawyers in these firms are looking at one thing - - their profits. Instead of seeing clients as individuals, they see them as case files. There is no personal attention or investment of time in the client. You are much more than some documents in a file folder; you are a real person with feelings, concerns and questions. We may have answered the same question hundreds of times; however, when you ask a question, you deserve to have it answered thoroughly to ensure you are comfortable with the bankruptcy process.
   
   
5. When you hire a bankruptcy lawyer, you expect to have your case filed within a reasonable period of time. However, when you are but one file of hundreds, weeks or months pass before your bankruptcy is filed and you get to court. The filing of your bankruptcy may be pushed further back because some assistant or junior lawyer wants to move another case along more quickly. Your file is shifted between several lawyers and assistants so that it never receives the proper attention you deserve. We understand your time is valuable and that you want to move as quickly as possible through the process so that you can begin rebuilding your finances and your life.

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