A chapter 13 bankruptcy is a very helpful tool for many people who are encountering overwhelming financial problems.  For individuals dealing with a potential mortgage foreclosure, chapter 13 offers a structured, affordable way to keep families in their homes.  For a person who has a car payment that has unexpectedly become too expensive, chapter 13 offers a way to restructure the car loan to make the payment more affordable.  For the person who is dealing with child support arrears, or back income taxes, chapter 13 provides a structure to pay these important obligations. 

So, you are thinking about filing Chapter 7 Bankruptcy and you say to yourself, I don’t want to lose my Harley Davidson worth 8k and no liens against it right? So, what do you do? You transfer the title to the Harley to your brother for nothing. Problem solved right? Wrong!

To understand what a reaffirmation agreement is in Chapter 7 Bankruptcy, you first must understand what the goal of a Chapter 7 Bankruptcy is. The goal of a Chapter 7 Bankruptcy is to obtain a Chapter 7 Bankruptcy discharge. A Chapter 7 Bankruptcy discharge absolves you of your personal liability for the underlying debt. Creditor must write the debt off and is not able to pursue debtor for the debt again.

I think one of the most anxiety producing events for a client is the meeting of creditors or 341 meeting. This is the meeting where the Chapter 7 trustee has debtor verify that the information on the schedules is true and correct and complete.

Section 341 of the Bankruptcy Code requires Chapter 7 trustees to conduct and for Chapter 7 debtors to attend a meeting of creditors. The code requires that a meeting of creditors must be conducted within a reasonable time from filing the Chapter 7 Bankruptcy. The purpose of the meeting of creditors is two-fold. First, it is to give the Chapter 7 trustee a chance to verify that the information contained in debtor’s schedules is true, correct, and complete. Second, the purpose of the meeting is to give creditors a chance to appear and ask debtors questions about debtor’s assets and debts and financial circumstances.

Section 704 of the Bankruptcy Code outlines the duties of a Chapter 7 trustee. A chapter 7 trustee’s primary role is to administer the Chapter 7 Bankruptcy case. This means that once assigned a Chapter 7 case by the US Trustee’s Office, a Chapter 7 trustee must review the schedules, question the debtor at a 341 meeting, and generally make sure debtor’s schedules are verified by debtor themselves.

We have discussed what reaffirmation agreements are in Chapter 7 Bankruptcy but what is a redemption agreement in a Chapter 7 Bankruptcy? The best way to illustrate a redemption agreement is to give you an example. Say you own a vehicle worth 5k but you owe 12k on the underlying loan.

While Section 109(a) describes who can file a Chapter 13 Bankruptcy, we want to know now where can the bankruptcy be filed?

It is not possible to move from one state to another and file Chapter 13 Bankruptcy the next day. 28 U.S. Code Section 1408 states that debtor may file a bankruptcy in the bankruptcy court of the federal judicial district in which the person filing bankruptcy has his/her principal residence, place of business, or principal assets. The domicile has to be where you were domiciled the greater part of the last 6 months and so, where you have been domiciled the last 91 days.

What is the goal of filing a Chapter 7 Bankruptcy? Getting a Chapter 7 discharge. Getting a Chapter 7 discharge means the debt is wiped out, tax free, forever. Are there situations where creditors can object to you discharging a debt? You bet there is. Section 523 of the Bankruptcy Code outlines several reasons a creditor could object to you discharging a debt made with the creditor.

Minnesotans are always amazed to find out that there really is a government sponsored debt consolidation plan. Most Minnesotans are not aware of this. If you live in St Paul, Minnesota and you are suffering from overwhelming debt and you are currently in a traditional debt consolidation plan, you are wasting your time. You read this right, you are wasting your time. Why? Because the government sponsored debt consolidation plan is much better for you and your family.

You’ve filed for Chapter 7 bankruptcy and have heard this type of case referred to as “liquidation bankruptcy.” This is because the bankruptcy trustee has the authority to seize a filer’s property and assets to liquidate and distribute the proceeds to your creditors. You look around your home, at the things you have, and the thought of selling everything to pay off creditors is understandably concerning.

You’ve filed for bankruptcy, and you get a notice from the court about a creditors meeting. What is this? Is it important? Do you have to go? What will happen at the meeting? Can the creditors stop your bankruptcy case?

Most people who file a bankruptcy case do so once in their lives. Thus, most people who file bankruptcy have no idea what a creditors meeting is, what happens there, what impact it can have on their bankruptcy case or, truthfully, anything at all about what the creditors meeting means or does. This is only one of many reasons why you should always hire an experienced attorney to take you through bankruptcy. An experienced attorney can guide you and help you understand what happens when you file bankruptcy every step of the way, including the meeting of creditors.

Yes, Chapter 7 bankruptcy can typically discharge most judgments. However, there are exceptions, such as child support and alimony. To ensure your judgment is discharged, consult with a bankruptcy attorney in your area. They can help you understand the specific rules and procedures in your state.

A lot of people have no idea the government has a debt consolidation plan. Did you know that? Probably not. What if I told you this debt consolidation plan is limited to 3-5 years, you pay what you can afford to pay, and at the end of the plan whatever doesn’t get paid off, gets wiped out, tax free? Peeks your curiosity doesn’t it?

When you file for bankruptcy, you likely face debts that far exceed your ability to pay them, and may have for some time. Maybe you have medical bills, car repairs, house repairs, or other unplanned major expenditures that make it difficult for you to keep up with your regular bills, like your car payment, utilities, credit cards, and your mortgage or rent. You’ve fallen behind on bills, and you alternate paying different bills each month, sometimes just enough to keep the water and electricity turned on. Maybe you’ve even fallen behind on your mortgage. You never answer your phone for numbers you don’t recognize out of fear it is another creditor calling to demand payment. You may receive notice loans in default or of lawsuits filed against you by creditors. You want to make it stop, but you don’t have the money to catch up, and you don’t know any other way to keep your creditors at bay.

In Part One of this series, we began reviewing some common terms you may hear during a consumer bankruptcy case. It is important to understand what is happening in your bankruptcy, which is possible with the help of an experienced Minnesota bankruptcy lawyer at Kain & Scott. Below, find brief explanations of additional common bankruptcy terms.