Many times, when you’re considering filing bankruptcy, you may be curious which option would be best for your situation. This decision can be quite difficult because there are several choices available. There are two common types of bankruptcy for consumers: Chapter 7 and Chapter 13. On the other hand, if you’re a small business owner, and you wish to reorganize, you’ll want to consider Chapter 11.
Bankruptcy lawyers MN say that the most common form of bankruptcy for consumers is Chapter 7. In most cases, this means that you will get to keep your exempt assets and get rid of those unsecured debts that are weighing you down. In Chapter 7 bankruptcy, the creditors will not be paid anything from your assets. There is another type of Chapter 7 bankruptcy that is known as an asset bankruptcy. In this type, your creditors will be paid back from any money that is collected from selling your assets.
The second most common type of consumer bankruptcy in the state of Minnesota is Chapter 13. In this form of bankruptcy, you’ll be able to pay off your debts over a specific period of time- typically 36 to 60 months. The difference in the terms of payments will depend upon your current income. If your income is above the average income, you will be able to do a 60 month plan, but if your income is under the average, you’ll be able to do a 36 month plan. This is a great option for those debts that cannot be cleared by Chapter 7 bankruptcy or if you don’t want your assets liquidated. Chapter 13 is better than debt consolidation because it allows your debt to be lumped together into a single monthly payment. Plus, it halts all collection activity and stops interest on the individual debts.
So, if debt is weighing you down and you’re worried about wage garnishments, repossessions, or bank levies, you’ll need to speak with a bankruptcy lawyer MN to find out if this is an option for you. Keep in mind that the longer you put it off, the worse it will be.Comments Off on Ask Bankruptcy Lawyers MN Which Option is Best for You