St. Cloud Chapter 13 Bankruptcy Lawyer

chapter 13 bankruptcy

St. Cloud Chapter 13 Bankruptcy Lawyer

Bankruptcy can be an excellent way to get the financial break that you need to overcome crippling debt and move on from past due medical bills, harassment from debt collectors, and the overwhelming feeling of being behind. Bankruptcy protection is a constitutional right in the United States. There is nothing to be ashamed of if you find yourself needing to use it. A good St. Cloud chapter 13 bankruptcy lawyer can help.

What is Chapter 13 Bankruptcy?

Chapter 13 Bankruptcy is a type of bankruptcy that allows debtors to pay off their debts, such as unsecured debt, over a period of time. The debtor has the option to file bankruptcy and make a payment plan depending on how much they can afford to pay. Creditors then receive payments from the debtor, rather than proceeding with creditor collection.

This repayment plan usually takes three to five years and requires debtors to make regular payments so that creditors can be paid back in full. With the help of an experienced attorney, individuals in Minnesota can get through the process quickly and successfully resolve their debts.

Who Can File Chapter 13 Bankruptcy?

Eligibility requirements vary, but generally speaking, if you have regular income and debts under a certain amount, you may be able to file for Chapter 13 bankruptcy. In Minnesota specifically, the debtor must have no more than $1,184,200 in secured debt and no more than $394,725 in unsecured debt in order to file a Chapter 13 bankruptcy. The debtor must also demonstrate an ability to make payments on their debts under the Chapter 13 plan.

How Can Filing for Chapter 13 Help You?

Filing for Chapter 13 Bankruptcy can be beneficial in helping you regain control over your debt. Chapter 13 bankruptcy is an alternative to Chapter 7 and it allows a debtor to keep their property while restructuring their debt in the form of a court-approved repayment plan. This plan stretches out your debts over 3-5 years, which reduces payments and helps the debtor catch up on missed mortgage payments or prevent foreclosure.

During this time, creditors cannot pursue collection activities against the debtor, such as wage garnishments or repossessions. Filing for Chapter 13 also allows you to pay off secured debts such as car loans and mortgages at a reduced rate that you can afford. With a properly structured repayment plan, filing for Chapter 13 can help you manage your debt and save your home from foreclosure.

How Does Chapter 13 Bankruptcy Work?

When a debtor files for Chapter 13 Bankruptcy, they must pass a means test and create a repayment plan that is approved by the court. This repayment plan must include provisions on how the debtor will pay back creditors over 3-5 years. During this period, the debtor may not take out any additional loans or credit cards without permission from the court. Creditors are also forbidden from taking any action against the debtor during this time period. Once the repayment plan has been completed, all remaining eligible debts will be discharged.

Chapter 7 vs. Chapter 13

Chapter 7 and Chapter 13 bankruptcy are two types of bankruptcy proceedings available to individuals in the United States. Chapter 7 bankruptcy is a liquidation proceeding where a debtor’s non-exempt assets are sold by a trustee to pay off creditors. In contrast, Chapter 13 bankruptcy allows the debtor to keep their assets while they enter into payment plans with creditors, supervised and approved by the court.

The primary difference between Chapter 7 and Chapter 13 bankruptcy lies in how debts are handled. In Chapter 7 bankruptcy, debt is wiped out completely, meaning creditors will not receive any payments from the debtor. On the other hand, in Chapter 13 bankruptcy, debtors must make payments for three to five years until all of their debts are paid off. Both types of bankruptcies have advantages and disadvantages depending on the debtor’s financial circumstances, and it is important to understand these differences when considering which type of bankruptcy to file.

Schedule a Consultation With a St. Cloud Bankruptcy Lawyer

If you are considering filing for Chapter 13 bankruptcy in Minnesota, it is important to contact an experienced St. Cloud Chapter 13 bankruptcy attorney. At Kain + Henehan, we will carefully review your financial situation and make recommendations to best meet your needs.

We have been successfully representing clients throughout Minnesota for many years and will work hard to ensure that these chapters in your life lead to a brighter future. Call us at (612) 438-8006 or fill out the online form. Schedule a free consultation to learn more about how our office can help you.




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