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.

Here is what CAN occur in a Chapter 7 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.

There are many options to try and resolve an abundance of debt.  Many of our clients seek these options before filing bankruptcy and that’s okay, since bankruptcy can be an intimidating process.  So, let’s breakdown your other options.

 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.

If you owe money to your credit card company, and if you stop paying them, they can sue you for the amount owed.  If that same credit card company obtains a judgment from a court, they can take that judgment and garnish your wages.

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.

Medical debt is dischargeable in bankruptcy, both in chapter 7 and chapter 13 cases.

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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Gambling debt can be included and discharged in your bankruptcy case.

 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.

In a chapter 7 bankruptcy, typically, the only hearing you will attend is the 341 hearing. This happens about 4-6 weeks after your case is filed.

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.

In most chapter 7 and chapter 13 cases, there is only one hearing you will need to attend.