Determining which form of bankruptcy to file is one of the parts of the process that people struggle with the most. The differences between the types of bankruptcy are complex and have a big impact on the potential outcome. In some cases, you also need to qualify to be able to file a certain type of bankruptcy.
At Kain + Henehan, we work with people just like you every day who need help with the process. We’ve helped hundreds of clients successfully file bankruptcy and we know the advantages and disadvantages of each type. Here’s what you need to know to determine which type of bankruptcy is right for you.
Transcript:
” We look at a number of factors. We need to know what kind of assets the client owns, what kind of debt the client owes. Some assets are easy to protect, household goods, furnishings, a vehicle that doesn’t have a lot of value, your home, those assets, equity in your home, those assets are pretty easy to protect in a bankruptcy case. You might have some other assets that are important that you – that are not protected in a bankruptcy case, and specifically a Chapter 7. In a Chapter 7 bankruptcy case, if you have recreational vehicles, if you have some cash accounts with balances in them, you could have trouble protecting those. Whereas an asset may not be protected in Chapter 7, it can be protected in Chapter 13. That’s one thing we look at, what kind of assets do you own, what kind of debt do you have.
Some kinds of debts are very efficiently discharged in Chapter 7, credit card debt, medical bills, unsecured debt, pretty easy to discharge. There are some debts that are harder to discharge. If you’re behind on a tax account, if you owe back child support or alimony, those debts aren’t going to go away if you file a Chapter 7, but if you file a Chapter 13, they can be discharged. We look at assets. We look at debts. Then the other thing that we look at is income because bankruptcy has a means test in it that if you’re above the median income for a household of your size in the state where you live and you apply the means test to that income, you might have to do a Chapter 13 instead of a Chapter 7. Assets, debt, income are the three big factors we look at.”
Discuss Your Situation with a Bankruptcy Attorney
No matter which type of bankruptcy is best for you, your best option is to discuss your case with an attorney. Not only can they advise you on which type of bankruptcy to file, but they can also help you through the process. Bankruptcy is a complex process that you should have legal help with to navigate successfully. Contact Kain + Henehan by calling (612) 438-8006 or filling out the online form for help with your bankruptcy plans.
