There have been some recent changes to the Minnesota Bankruptcy exemptions, which have greatly benefited debtors.

When you decide you want to file a bankruptcy case you can either file with an attorney or file pro se, unrepresented. 

When contemplating the possibility of bankruptcy, many often wonder how this process begins and what the necessary steps to move forward with it might be.  Curiosity on this point is very understandable, as bankruptcy can be a completely new experience, and we naturally want to know more about how a journey begins before we embark on it.  This blog will provide context on the opening phases of the bankruptcy process, and will guide you through the steps necessary to begin them.

When a bankruptcy case is filed, you list all of your assets, whether you have them now or are just entitled to them at the time of filing. You will list assets from real estate you own, all the way to potential claims or causes of actions and everything in between. It is important when you file bankruptcy that your assets are valued properly. You do not want to under value the assets you have, but you also do not want to over value them. 

One of the first things that many people consider when contemplating a bankruptcy is the effect the filing will have on any vehicles that may be co-owned by their children, or registered in the parent’s name on the child’s behalf.  There are many reasons that we might find ourselves co-signing on a vehicle for our children.  Often, a child may still be a minor when a vehicle is purchased preventing them from registering it in their own name on the title.  Conversely, a parent may also co-sign on a vehicle for one of their adult children for the purpose of assisting with the financing process. Regardless of the reason however, the ultimate result is that the parent will be included on the title to the vehicle, and if applicable, will be co-signed on any loans taken out to finance it.

Receiving a notice or a demand from a debt collector can be jarring.  You might wonder who they are, or why they are contacting you.  In many circumstances it can be difficult to tell why they are reaching out or even who they might be collecting on behalf of, especially if the debt they are be pursuing is old or traces from a closed account.  The good news in this circumstances is twofold.  First, that you always have the right to demand that a debt collector verify what debt they are trying to collect on, and second, that in most circumstances, bankruptcy can be a tool to help you deal with their ongoing efforts to collect from you!  

Filing bankruptcy is not an easy decision and often leaves clients with a complex mix of feelings. No matter how you feel, you are not alone. Every day, we have clients sharing with us their stories and how bankruptcy makes them feel, and every day one of the most common things we hear is relief. But relief is definitely not the only thing we see. Here are some common emotional experiences associated with the bankruptcy process:

You may hear the term domestic support throughout your bankruptcy case. For example, during the initial consultation your attorney may ask about it, the trustee will ask if you pay a court ordered agreement during your 341 hearing, or at the end of your case in a chapter 13 you will be asked if you are current on payments. What is domestic support? 

In a generation where the prices of homes, cars, and pretty much anything are rapidly rising, it more and more clients come to us saying they own “absolutely nothing.” Now that’s usually not true. Most of us own clothes, maybe a pot or pan, a few pieces of jewelry. But when we talk about assets, most people think of homes and vehicles. So let’s talk about the “good” side of having “absolutely nothing.”

Bankruptcy is intended to provide an individual with a fresh start, but there are expectations for the debtor. It starts with disclosure. The premise for any bankruptcy is honesty, and disclosure so if a debtor is unwilling or unable to provide the court with the appropriate documents or testimony, then that individual is not a good candidate for filing a bankruptcy. 

When you file bankruptcy you will list all of your assets, meaning everything you own. This includes your jewelry. 

When filing bankruptcy, it is common to wonder which creditors will be included in the filing.  Related to this, it is also very common to wonder how various loans will be treated or resolved.  In certain circumstances there may be a specific creditor that you do not wish to discharge a debt with.  Similarly, there may be a specific loan, such as a mortgage, car loan or retirement account loan that you do not wish to discharge either.  One of the many benefits of the bankruptcy process is that it does not require you to treat all debts in exactly the same way; herein we shall examine a few of the ways in which this principle is observed.  

When you file bankruptcy, you will list all of your assets- this includes assets you currently have or are entitled to in the future (think inheritances or causes of action). 

When filing a Chapter 13 Bankruptcy, many often wonder how payments are calculated and to what extent their financial means will be considered in the process of determining that payment.  Fundamentally, payments are calculated according to two principles: the best interests test, (also referred to as the BIT) and the best efforts test.    

Something that many people wonder when they file bankruptcy is how the filing will effect a car loan that exists at the time that the bankruptcy is filed.  It is a natural question, and one that is highly important in the context of ensuring that you are able to keep your vehicle after the bankruptcy is filed.  Ultimately, the treatment of the car loan will depend on the chapter of bankruptcy that you file, but in most circumstances you will be able to retain the vehicle and continue to make payments on the related loan.  

If you are in a chapter 13 bankruptcy or preparing to file one, you may have heard the term “step up” used by your attorney or the trustee of your case. A step up is when your payments are stepping up in amount, for one reason or another. These are typically set dates where the payment will go up, due to some triggering event.