Right before his son went off to the big city in Shakespeare’s Hamlet, Polonius told Laertes “Neither a borrower nor lender be/For loan oft loses both itself and friend.” In other words, be careful about borrowing and lending money to friends. If you lend, they won’t pay it back; if you borrow, you’ll fall out of favor. But loaning and borrowing is not bad. In fact, sometimes both are very good.

His advice is still valid in today’s Minneapolis. People haven’t really changed much since the sixteenth century. So, mixing money and friendship still ends badly most of the time. But sometimes, you need to borrow money. In fact, over two-thirds of the nation’s $13.2 trillion in household debt is mortgage debt. Most of the time, mortgage debt is “good debt.”

Bankruptcy is quite unlike other civil cases in Minnesota. In a divorce or commercial dispute, the judge controls almost everything that goes on in the case. But in a bankruptcy, the debtor may not ever even see the judge. In fact, it’s not uncommon for the debtor never to even go in a courtroom.

Instead, the trustee has day-to-day responsibilities in terms of case management. These responsibilities vary significantly between a Chapter 7 and a Chapter 13. However, the trustee’s overall role in a Minnesota bankruptcy remains the same. The trustee, who is not a judge and may not even be a lawyer, must do what is in the best interests of the creditors. The trustee is not on your side. That’s your lawyer’s job.

The 2005 bankruptcy reform act significantly changed parts of the pre-filing process. Supposedly, banks approached then-President George W. Bush about such a measure shortly after he took office in 2001. But because of the proposal’s harshness, he said he would not sign it until his second term. The 2005 law made a number of changes which were designed to make it harder to file Chapter 7. These changes are outlined below.

Other parts of the pre-filing process are unchanged. That include the initial consultation with your Minnesota bankruptcy attorney. At Kain & Scott, we believe in very thorough consultations which review all your bankruptcy and non-bankruptcy debt relief options. An extensive consultation also helps clients understand what happens when they file bankruptcy. That is a tremendous advantage for everyone.

Supreme Court Justice James Clark McReynolds was one of the first Justices to set out the purpose of bankruptcy laws. In 1915, he wrote that bankruptcy is designed to “relieve the honest debtor from the weight of oppressive indebtedness and permit him to start afresh free from obligations and responsibilities consequent upon business misfortunes.” So, most Minnesota bankruptcy debtors are entitled to debt relief.

The nature of this fresh start largely depends on the type of bankruptcy the debtor files. It also depends on a concept called reaffirmation, especially in certain kinds of bankruptcy.

Many Minnesota families have excessive credit card debts. Making matters worse, according to one estimate, 60 percent of cardholders struggle just to make the minimum payment. So, every month, the family goes deeper into debt. This downward debt spiral quickly becomes overwhelming.

Many “debt consolidation” firms only make empty promises. But there is a federal debt relief program that’s designed to do away with excess debt and give Minnesota families a chance to start over. But bankruptcy is a very big decision. Before you file your voluntary petition, it’s important to know everything about Chapter 7 bankruptcy.

Many of us, when we are going through financial difficulties, have relied on credit cards to get us through.  We have “emergency credit cards.” We have the credit card to use in a pinch to get us through until the next pay check.  To think about not having that safety net is scary, right? So, for many of us, to think about filing bankruptcy, even if it means getting rid of the debt that haunts us, it also means the scary thought of losing that safety net.  What happens if I need money and I still have a week before my next pay check? What do I do? Does filing bankruptcy mean I lose all of my credit cards? What will be my back up plan? How long before I get another card? What will I do in the meantime?  These are all valid questions and these are things Kain & Scott can help you answer as we prepare you for bankruptcy

The average debt-laden college graduate has almost $30,000 in student loans. That amount has increased 25 percent since 2008. Even with low interest rates and extended repayment periods, the monthly payment is often several hundred dollars a month. That’s a lot of money for anyone, and especially for young people. Quite understandably, many of these individuals delay major purchases and are overly-cautious with their money.

Most likely, bankruptcy would affect a business partner. However, the effects are almost all positive.

Sometimes, liquidating a failing business is the best course of action. This issue is very common, as only a small percentage of new businesses survive past the first five years. A failed business does not necessarily mean that you and your partners are poor planners or businesspeople. It just means that, for whatever reason, a particular concept did not work out.

Bankruptcy gives fresh starts to distressed debtors. But it uses the least restrictive means to accomplish this goal. Property rights are sacred to many people in America, and that includes a contract between a debtor and a creditor. So, bankruptcy does not interfere with that contract.

Instead, a bankruptcy discharge removes the debtor’s legal obligation to repay debt. It does not affect the collateral consequences. Assume a judge discharges past-due university tuition. The school cannot do anything to collect the amount owed. However, it can withhold the student’s transcript until the debt is paid or otherwise resolved. A bankruptcy judge does not have the authority to order the school to release the transcript.

So, last we spoke, we spoke about Mary’s account being frozen. The creditor had frozen Mary’s 12k 401k loan proceeds and Mary had come in to see me about what her choices were to resolve her debt problem.

There are 3 mistakes you should avoid when filing bankruptcy in St Paul, Minnesota. These mistakes have to do with representation in a bankruptcy or a lack thereof. At Kain & Scott, we are Minnesota’s oldest bankruptcy law firm. We have seen a thing or two and we would recommend you avoid the mistakes we have seen others make. For example-

Welcome to Woodbury, Minnesota’s best bankruptcy law firm, Kain & Scott. Why Kain & Scott? Good question. We wrote the book, “Filing Bankruptcy Sucks, Your Lawyer Should Not!” We wrote the book because we were frustrated by how Minnesota bankruptcy guests were being treated. Well, let’s break it down, why is Kain & Scott Woodbury, Minnesota’s best bankruptcy law firm? I will give you 5 reasons:

The following is based on a true story. The names I use are fictional but the story is real. Mary came into see me about her account being frozen by one of her creditors. Mary had just taken a loan out from her 401k and the 12k in proceeds were in her bank account when the unthinkable happened- the creditor placed a levy on the account and froze 12k. Now, to say this was not good timing is an understatement. Mary is an RN but she was off work for several months due to medical complications. She was not entitled to short term disability and so she was taking the 401k loan out to help her and her husband survive the time when she was out of work.

To protect their property and families, thousands of people file bankruptcy in Minnesota every year. Moneylenders want people to feel ashamed when they file bankruptcy, to discourage such actions. But most people file bankruptcy because of medical debt, divorce, unemployment, or some other situation which was totally beyond their control.

Nevertheless, there are still many impediments to filing bankruptcy in Minnesota. Some people worry about how a voluntary petition will affect their jobs. Others worry about how bankruptcy may affect their spouses, and that’s the subject of this post.

It is odd that I have to say this, but if a Minnesota resident intends to file for bankruptcy in Minnesota, choose a Minnesota BASED law firm. Why do I say this? Because there are out of state law firm’s soliciting Minnesota residents to file bankruptcy using an out of state law firm- some of who refer you back to a Minnesota lawyer who doesn’t have the same bankruptcy experience many other Minnesota bankruptcy attorneys have.

We are so confident we are Minnesota’s Nicest Bankruptcy Law Firm we guarantee it and trademarked it! That is right, we trademarked “Minnesota’s Nicest Bankruptcy Law Firm Guaranteed or 100% Off Your Fees”!*

A law firm that is willing to guarantee their service to you is confident about the service you will receive. So confident, in fact, that we guarantee it or 100% off your fees. Unique? We think so! If you live in Minneapolis, Minnesota, and you are thinking about filing Chapter 7 or Chapter 13 Bankruptcy, if you are looking for the best customer service in the state of Minnesota, there is no other firm to turn to besides Kain & Scott.