At Kain & Scott, our MN Bankruptcy Lawyers have been filing bankruptcies in Minnesota since 1972. In that time, we have filed many thousands of bankruptcy cases. After a while, you can see patterns that Minnesotans go through before they file for bankruptcy protection. It’s almost like clock work really. So, if you see yourself doing one of the five common things people do before they file bankruptcy in Minnesota, you should ask yourself, is this me too?

Having a family brings with it many responsibilities and obligations. We all want to do the very best we can for our loved ones. Unfortunately, unexpected hardships and financial difficulties are almost inevitable with the limited resources that many of us must contend with. Bankruptcy proceedings are designed specifically as a solution for those faced with such hardships so that they may again find financial stability and bring comfort for those we love, cherish and care for. MN Bankruptcy Lawyers can provide you with a fresh start to your finances and immediately halt any actions being taken against you by many of your creditors so that you may begin the process of recovery and family stability.

I remember the conversation clearly, even though it took place more than 10 years ago: I had just finished meeting with a client - let’s call him “Josh” - to review a draft of the petition and schedules our office prepared for his Chapter 7 Bankruptcy. We reviewed the draft carefully to make sure that we were listing all of the assets Josh owned and that he had listed all of the creditors to whom he owed money. We took a good look at his payroll records to make sure that his monthly income was being reported accurately. We made sure that any unusual financial transactions that took place shortly before our meeting were disclosed, and the requisite detail provided. Once we knew the information was accurate, Josh signed the papers...  

Bankruptcy has many negative connotations and is often perceived by society to be a sign of one’s failure to manage one’s finances effectively. But this could not be farther from the truth when we take a careful look at many of the contributing factors which force individuals to turn to Minneapolis MN Bankruptcy Lawyers for financial relief. Many institutions and lenders have gone through great lengths to structure their agreements and contracts with consumers so that the lenders may profit greatly from potential hardships a consumer may unexpectedly face.

So much is written about the process of bankruptcy IE what happens when you file, what is a meeting of creditors, what happens after you file to your credit score, but very little is written about what to do, or in many cases not to do, BEFORE you file bankruptcy. I can’t tell you how many times I uttered the words, “I wish you would have called me before you did that.”

For the past two weeks, I’ve written about the issue of timing in bankruptcy cases. Two weeks ago I looked at timing from the perspective of collection by creditors in my blog, How our Minneapolis Bankruptcy Lawyers Know When You Should File. Last week, I looked at timing as a function of the Bankruptcy Code, and talked specifically about timing the filing of a chapter 7 case. This week I want to discuss timing issues with chapter 13 cases.

Last week I discussed the timing of the filing of a Chapter 13 Bankruptcy case specifically in relation to mortgage defaults and foreclosure. Chapter 13 Bankruptcy is commonly filed by people with debt problems who are facing defaults in secured loans, such as home mortgage loans. The most common secured loan, though is a vehicle loan. Because of the retail price of both new and used cars, many if not most consumers have to finance the purchase of a vehicle.

Chapter 7 Bankruptcy is also commonly referred to as the “fresh start” bankruptcy. Chapter 7 is the most commonly filed consumer Bankruptcy in Minnesota for several good reasons. Immediately after you file a Chapter 7 you’re protected from any creditors trying to take property that secures a debt. Creditors are prohibited from obtaining a judgment for unsecured debt that can be turned into a lien against your property. You also get the option to keep any property that secures a debt or give it up to your creditor without having to pay them. Chapter 7 Bankruptcy can really give you some comforting power over your creditors. Here’s how:

At Kain & Scott, one of the biggest concerns that our clients have is what’s going to happen to their house when they file bankruptcy. However, there’s no need to be alarmed because most of the cases that our MN Bankruptcy Lawyers file are considered “no asset” cases. That means you get to keep everything, including your house. No matter where you live in Minnesota there are either state or federal bankruptcy exemptions designed to protect your property. And fortunately in MN our MN Homestead Exemptions are rather generous compared to most other states.

All right, it’s time to get out of this financial turmoil. You’re over your head in debt and you’re trying to stay current on your payments yet you just can’t do it anymore. Creditors don’t stop calling and harassing you and it’s extremely overwhelming. You’ve came to the conclusion that the only way out is bankruptcy. So you get online and start searching for a MN Bankruptcy Lawyer. The second you type in the query MN Bankruptcy Lawyer in Google and press enter, you get hundreds of results. Uh oh, now what?

So your life is upside down and in financial turmoil. You can’t afford to satisfy your debts anymore and creditors are calling screaming at you for payments. You feel guilty, stressed out and depressed but at the same time you’re asking yourself, “What in the world am I supposed to do?” After realizing that doing nothing isn’t going to make things better and debt consolidation is a waste of time you come to the conclusion that filing bankruptcy is the best and/or only solution for you. Now you need a MN Bankruptcy Lawyer... So what’s next?

How many of us lawyers meet with clients and yet miss issues the client could pursue to their benefit? I suspect the answer is a lot of us. Don’t be too hard on yourself since it’s impossible to know everything right? Most of us limit our areas of practice to a few and focus on those areas. When clients ask our MN Bankruptcy Lawyers and I about other areas of law we get jittery and tell them that we don’t practice in that area and they should see a lawyer who specializes in it. At Kain & Scott every Lawyer has a referral directory that we use to refer clients to any other area of law besides consumer bankruptcy work. Minnesota Bankruptcy work is all we do.

There comes a point when your debt is so deep that it feels like you just can’t stay above water anymore and bankruptcy might be the only way to stay afloat. However, accepting that you might need to File Bankruptcy for relief is only the first step. Once you’re ready to take advantage of the many benefits Bankruptcy has to offer, next it’ll be in your best interest to take some time to learn the basics of Bankruptcy, it's process and how to file. The process is fairly simple but just like any other legal process it’s very important that your case is handled properly. Here’s how to File Bankruptcy in Minnesota.

The most important aspect of filing bankruptcy is your exemptions. Exemptions are the laws that protect your property from being seized by the court and liquidated to pay your creditors. Having your MN Bankruptcy Lawyer understand what property you own and the laws in place to protect it is critical. If you don’t disclose your property and its value correctly, then your lawyer will not be able to analyze your case properly, and it could have negative consequences such as losing property or having to pay into the court to keep property.

Payday loans have been in the news over the last week and prevalent in conversation among the MN Bankruptcy Attorneys at Kain & Scott. The Consumer Financial Protection Bureau has come out with a proposal to target payday loan lenders that trap consumers in long term debt. Payday loans are short term, high interest loans usually for less than $500 dollars that are paid back with your next paycheck. As internet payday lending has expanded so have the interest rates and fees. I often work with clients who have gotten into the cycle of payday lending.

For most of the clients I meet at my Minneapolis Bankruptcy Law Firm, the most important question they have, after we finish analyzing their financial circumstances is whether it is advisable to file a bankruptcy case. That’s the primary question, and in most cases, the only one. But for some clients there are additional questions - should I wait to file a case, or should I file right away. And for a few clients, the question is whether they should file a case in Minneapolis, Minnesota, or some other state. Let’s take a look at the factors that enter into decision-making about whether to file, when to file and where to file.