03 Aug The First Steps In Filing For Bankruptcy
There are many reasons why someone might file for bankruptcy. Whether you are suffering from unresolved medical bills, an unexpected job loss, tax debts, or even divorce debt can happen to anyone at anytime.
There are many ways to handle debt consolidation, and bankruptcy is the most common. Filing for bankruptcy can be tricky, few people know much about the process or where to start.
Here are a few steps you will need to take to get started on the road of filing for bankruptcy in Minnesota.
What You Will Need To File
When filing for bankruptcy in Minnesota, there are few things the court processing your bankruptcy is going to ask from you. You will typically receive a large packet of paperwork requesting you fill in detailed information on your financial history.
This information can include how much debt you currently have, any assets you might have to your name, how much you make per year versus how much you spend, and information on any major financial transactions in the last two to three years.
Completing the forms that come in your packet with correct and up to date information is crucial when filing for bankruptcy.
If you aren’t sure what the answer to a question is, look it up. Never guess on a figure because if it is incorrect you could have to wait, and possibly pay, for an amendment to be filed.
Worst case the court processing your bankruptcy will no longer trust you to be capable of providing correct information and your case could be thrown out.
File With An Attorney
While it is legal to file a Chapter 7 or 13 bankruptcy on your own without an attorney, it is not advised.
Not only will a bankruptcy lawyer, who specializes in bankruptcies, catch what you miss but they also know exactly how the process works and will be there to answer any questions and concerns you may have.
Most importantly they are going to make sure that you aren’t taken advantage of and you get the best possible outcome when filing for bankruptcy.
Depending on how much and the type of debt you have a bankruptcy attorney is going to know exactly what paperwork to file to keep the stress off of you. At the end of the day many people, who filed on their own, say that if they could go back they would hire an attorney.
If you don’t think you can afford a lawyer ask about working your lawyer’s fees into your bankruptcy payment plan.
Chapter 7 or 13 Bankruptcy
When filing for bankruptcy you will need to determine which type of bankruptcy you qualify for, a Chapter 7 or 13.
A Chapter 7 bankruptcy is a short-term plan that usually takes three to six months to complete. You can count on paying off most of your debt in this period but you are more likely to lose personal property. You may not qualify for a Chapter 7 bankruptcy if your income is too high.
A Chapter 13 bankruptcy is a long-term plan that can range from three to five years. On a Chapter 13 you will repay your debt on a plan that’s based off of your income. It can be more complicated and take longer but the chances of you keeping more of your personal belongings are higher with a Chapter 13 filing. If your debts are too high and you have a low income you may not qualify for a Chapter 13 filing.
If you ask, most people who file for bankruptcy will tell you they never thought they’d find themselves in this situation. Crippling debt is not something to take lightly and neither is filing for bankruptcy.
While this isn’t the entire process it is the first few steps on, what can seem like, a long and confusing path.
Debt can be painful and it can pile up on anyone at anytime. If you are suffering from an overwhelming amount of debt and wondering if bankruptcy is for you give us a call.
We can discuss what options you have when trying to get out of debt and help you get out from underneath overwhelming finances.