Filing for bankruptcy is very often the best option for someone who is in a financial position where they are unable to afford to pay their ongoing bills and expenses in addition to their debts. When this happens, a person should try their best to continue paying their necessary ongoing expenses and bills, such as their mortgage payment, car payment, utility bills, and groceries. These needed expenses are more important than paying on old debts, especially if a person is planning on filing for bankruptcy and getting rid of those old debts anyways.

     Recently, I have been reading about and materials belonging to some of the ancient Greek philosophers. Socrates left behind no works or books. What we gleam from Socrates and who he was comes from students of Socrates like Plato and others. One of the comments Socrates is known to have said is, “When the argument is lost, slander becomes the tool of the loser.” I absolutely love this statement made by Socrates because it is 100% truth. How often have you been in a debate with someone only to have the other person resort to name calling or worse? Socrates was himself punched, kicked, had his hair pulled, and ultimately killed for searching for the truth. And yet today, in 2021, slander is alive in well from those who try and conceal bad faith arguments or bad acts.

     Would you consider hiring a bankruptcy lawyer who was fired from their job filing bankruptcies? I would not. I would prefer my bankruptcy law not have been terminated from their former firm for any reason. If you were terminated from your job, I would naturally wonder why were you terminated from your previous job? I mean, do you struggle following boundaries, easy boundaries set by your former employer? How do I know you will follow simple boundaries with me as a client?

There are a number of parties when you decide to file for bankruptcy.  There’s you, the debtor.  Your attorney, if you choose to hire one, who represents you.  There are your creditors, companies or individuals you owe money to.  And, there’s a trustee.  A trustee is an individual who reviews and investigates your bankruptcy petition and schedules.  They are supervised by the courts and the United States Trustee Program, which is a part of the Department of Justice.

When a person files for bankruptcy, their property is considered exempt, protected from creditors under the law, or non-exempt, not protected from creditors. In a Chapter 7 bankruptcy case, the debtor is required to give any non-exempt property they have to the trustee to be included in the bankruptcy estate and used to pay creditors or enter into an agreement with the trustee, wherein they agree to pay the trustee to keep the non-exempt property.

Chapter 7, or “liquidation” bankruptcy is the most straightforward path to bankruptcy relief for most of the people I talk to who are seeking bankruptcy relief (called “debtors”).

People file bankruptcy when they can no longer continue keeping up with paying their debts.  When faced with the decision of staying current on your rent or making payments upon your debts, it is always advisable to choose to make your rent payment rather than paying on the debts. Nobody wants to be evicted and most of your debts will be likely be wiped out by your bankruptcy discharge anyways (except for most types of tax debt, domestic support obligations, and student loan debt, etc.)

Getting behind on your mortgage payments is not uncommon, but when the amount of the arrears (the amount you owe from the missed payments) is substantial it can be hard to get caught back up with your mortgage payments. There are many reasons people get behind on their payments: temporary job loss, divorce, medical issues. And sometimes working with the mortgage company to make arrangements to repay the missed payments can be daunting and frustrating especially if the mortgage company has already started the foreclosure process.

When you file bankruptcy you are required to list all of your assets on your bankruptcy petition.  In fact, you will be required to testify under oath that you have listed all of your assets and any interest you may have in an asset.

    Every single person I have ever met was a bit terrified of the “b” word. Some are more terrified than others. My heart hurts for those people who suffer far too long with a debt problem because they are terrified of the “b” word. Our former clients know how you feel. They all felt the same way you do now. But what they found is the “b” word was not only not terrifying, it became the key that unlocked their future and freed them from an incredible burden.

     What is the single biggest mistake I see people in Minnesota make when they are looking for bankruptcy representation? I see two common mistakes. First, too many people chose the first firm they talk with. Now if the first firm you talk with is LifeBack Law Firm, a quality Minnesota bankruptcy law firm, you have got something. But too often I hear the horror stories of people who select the first firm only to find out later that firm’s reviews are horrible. Just take a look at some of these law firms Google reviews and even Glassdoor reviews and you will see you may want to keep dialing the phone.

It is quite odd that in bankruptcy, there is no specific exemption to protect guns. Now this is a bit odd considering that there is a Second Amendment right to bear arms. However, just because something is a constitutional right does not necessarily mean it is exempt in bankruptcy and protected from your creditors. I am not telling you this is right, I am just telling you this is the reality of the Federal and Minnesota exemption schemes as it is right now

Not everyone qualifies to file a chapter 7 bankruptcy. In order to curb perceived abuse, Congress modified the Bankruptcy Code. On April 20, 2005, President Bush signed the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (the "Act"). The Act was intended to address certain abuses of the bankruptcy process. Among the abuses identified by Congress was the easy access to chapter 7 liquidation proceedings by consumer debtors who, if required to file under chapter 13, could afford to pay some dividend to their unsecured creditors. 

Not all debts are treated the same in bankruptcy. Unsecured debts are those debts that are not secured by collateral. Of course, secured debt remains secured to the collateral even in bankruptcy, but strictly speaking about unsecured debt-will it all be discharged in the bankruptcy?

You are not alone. Each year, thousands of good Minnesotans find themselves suffering with overwhelming debt often through no fault of their own. Broken relationships, businesses that fail, medical problems that occur, incomes that drop, and yes, bad financial decisions that get made because we are human and not robots. But when you are suffering from debt, the last thing you ever want is to deal with a law firm full of cold and antiseptic people who simply don’t care about you at all and you can feel it. There is a better way.