Student loans continue to be an issue for many Americans. The pending litigation surrounding the loan forgiveness of the Biden Administration is being watched carefully for those that may be eligible for loan forgiveness. 

     If you are contemplating filing Chapter 7/13 Bankruptcy your bankruptcy attorney will need you to gather some documents. These documents are necessary for you to gather to make the bankruptcy filing process smoother. 

Secured creditors are those creditors with security interest in your collateral. Commonly this is houses, vehicles, boats, cabins or land. The creditor will take a security interest in the property, so if payments are not made they can get the value of their loan back from a repossession or foreclosure. 

     As a bankruptcy attorney, this is the most common question we get from concerned clients prior to filing bankruptcy. What will my credit look like after filing Chapter 7 Bankruptcy in Minneapolis, MN? The question is legitimate. Who would not be concerned about the impact of Chapter 7 Bankruptcy on your credit?

A Chapter 13 bankruptcy is a three-five year repayment plan, whereby the debtor pays in as much as they can afford to their creditors each month. At the end of the plan, the debtor will receive a bankruptcy discharge of their remaining debts. Therefore, in a Chapter 13 bankruptcy, typically a debtor does not pay their debts back completely in full. Absent certain exceptions, a debtor will receive a “wipe out” of most of their unsecured debts. Although a Chapter 13 bankruptcy provides a great opportunity for many Minnesotans who are struggling to pay their debts to achieve financial relief, not all Chapter 13 bankruptcy plans are successful. The most common reason for an unsuccessful Chapter 13 bankruptcy is the failure to make consistent monthly payments. Debtors often encounter unforeseen and difficult circumstances that arise after their case is filed. For example, the debtor may experience significant loss in income or a reduction in household income due to a loss of a job or unforeseen expenses. In many of these cases, the bankruptcy court may allow the debtor to file a modified plan based on these changed circumstances, as long as the modified plan still provides the minimum amount that needs to be paid to creditors. 

Although a bankruptcy discharge will cover a lot of an average consumers’ debt, there are some debts that are not subject to discharge. 

A CMA, or comparative market analysis, is typically done by a licensed real estate professional. The realtor will usually go through your property to price it out for sale, comparing other properties of the same size, condition, and in similar neighborhoods. 

Before filing a bankruptcy case, it is important that you do not incur any debt. There are specific federal laws that make certain debts incurred prior to filing presumed non-dischargeable. Meaning, under these laws creditors wouldn’t have to do anything to have the debt deemed non-dischargeable in your case.

     Here are two things to avoid when filing Chapter 7 Bankruptcy in Minneapolis, MN. First, do not file a bankruptcy yourself. A person who files a Chapter 7/13 bankruptcy them self has a fool for a client. The Bankruptcy Code is a complicated legal set of rules that govern your assets and debts in bankruptcy. It takes years of practice before a lawyer can understand what the Bankruptcy Code says and how it intersects with actual cases. 

     How can you tell if you should file Chapter 7 Bankruptcy? Suppose Al has credit card debt of 20k and a medical bill for $2,500.00. Al makes the minimum payments but Al is not decreasing the principal balance much and when he is finished paying all of these minimum payments, he has little left over to purchase groceries, pay rent, pay utilities, and vehicle expenses so he can do it again next month.

The thought of filing a bankruptcy can be stressful and nerve-racking. Although, sometimes it is hard to get rid of all nerves and stress, at LifeBack Law we strive to make the bankruptcy process as stress free as we can for our clients. Filing bankruptcy is a big deal, which is why you should feel confident and comfortable with the attorney you hire. 

Recently, we gave a project to three LifeBack Lawyers to detail what a leader at LifeBack Law Firm looks like.

Not all debts in a bankruptcy are treated equally, and some debts can be excepted from the bankruptcy discharge. Under § 523(a)(6), the creditor must demonstrate "willful and malicious injury by the debtor" to another person or their property, and if a creditor can successfully demonstrate a willful and malicious injury by the debtor the creditor’s claim can be excepted from discharge. 

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