Let Minnesota Bankruptcy attorney Margaret Henehan tell you about types of bankruptcy in this brief video.
Personal Bankruptcy is an option and a right in the United States to address overwhelming debt and the inability to meet their financial obligations. At the Law Firm of Kain+Henehan, we want to make you comfortable from the first phone call. We will lay out your options and make sure you understand the best solution for you. Dealing with financial debt and bankruptcy is difficult; dealing with us and our process should not be.
Yeah, so the two types of bankruptcy that consumers regular people file are Chapter 7 and a Chapter 13. A Chapter 7 is the bankruptcy people are more familiar with. It’s the one that wipes the slate clean. It’s a fresh start. Those are the words you’ll see a lot. It’s the one that’s going to discharge medical bills, credit cards, unsecured loans. It doesn’t take care of tax debt typically. It doesn’t take care of student loans typically. It’s going to really get rid of the unsecured debt. It takes care of utility bills, pass due landlord debts, any type of unsecured debt. The Chapter 7 you have to income qualify for. You’ve got to be under a certain median income for the state of Minnesota in order to qualify for, though it’s quite high at this point for income because there’s high cost of living in Minnesota. For example, a household of one is right around $63,000 you have to earn under that for the annual income. If you are over that income, you qualify then for a Chapter 13 bankruptcy which is the repayment plan bankruptcy. I say it looks like debt consolidation. All your debt goes into a pool. You pay one monthly payment to the trustee and the trustee divides that amongst your creditors. A Chapter 13 is the three-to-five-year payment plan. It’s a great bankruptcy option for people that are behind on their mortgage reviews, who have tax debt. Even if you’re under a certain median income, you always can file a Chapter 13. It’s not just reserved for higher income people. If you’ve got debt that you need to catch up on or you’ve got assets that you would lose in a Chapter 7 then Chapter 13 is a great option. ”
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Kain + Henehan are bankruptcy attorneys serving clients across all of Minnesota with personal bankruptcy. Call 612-438-8006 or use our online form to learn more.