Lets take a closer look at the steps you and your MN Bankruptcy Lawyer will take when you file because there are countless individuals and families who find themselves facing financial hardships unexpectedly and these people are often unsure of their options. The bankruptcy process is federally regulated and put in place for those who find themselves in these difficult financial circumstances. Many people are concerned with the complexities involved in legal matters and are apprehensive because of this that's why it's best to seek the knowledge and experience of a trained legal professional but it is equally important that you understand the undertaking.
In this article we will be reviewing the basic process of filing bankruptcy so that we may eliminate some of your fears and concerns. Bankruptcy can be a very simple process that will quickly get you back on the road to recovery when handled by a professional acting in your best interests. Let’s begin to look at the bankruptcy basics...
The Predatory Credit counseling Services That Will Cause You Problems
Before considering bankruptcy many of us may look into a credit counseling program to aid us with financial restructuring. This can be a slippery slope. Many organizations are approved by the federal government and not only help you to better manage your finances but also fulfill your legal obligation to undergo credit counseling with a recognized service within 180 days prior to filing bankruptcy. Be warned that there are also many predatory credit counseling services out there also, which only perpetuate your problems. Be vigilant of any actions being taken against you on the part of the creditors your credit counseling services claims to be in negotiation with. Credit counseling services will often charge you a fee or surcharge for their services without working out agreeable arrangements with the creditors. People are often led to believe that because they are paying something and making an effort no legal action can be taken against them which is certainly not the case. It is important to remember your debts are legal obligations for which you will be held liable, not your consumer credit counseling service. A bankruptcy professional can direct you to a certified organization and you may be able to get your finances under control with some careful planning and assistance from trained experts.
The Federal And State Exemptions
You will also need to Find Out If You Pass The Means Test which is an evaluation of your finances as a whole. Your income for the last six months prior to filing bankruptcy will be calculated and it is important to be aware of this. Your earnings will be compared to the statewide median for a household your size and if your earnings exceed the median you may be ineligible to File Chapter 7 Bankruptcy. In almost every case that the means test prevents a Chapter 7 Filing a Chapter 13 Bankruptcy will be available for you.
All relevant financial records dating back at least two years will be evaluated as well as any property you are holding. Your tax filings will be reviewed and this documentation must be provided in its entirety to the best of your ability. Filers must understand that they are under scrutiny; any omission could greatly complicate your filing process so it is essential you are open and honest with your lawyer so that they may help you to the very best of their ability.
This documentation you have gathered also plays a key role in evaluating what to be exempt or excluded from the bankruptcy. Under federal and state law debtors are provided several exemptions. Bankruptcy is designed to provide citizens with a means of recovery from financial hardship and many of the things we all hold dear or consider essential are protected by legislation. You and your MN Bankruptcy Lawyer will petition the court with your request and documentation regarding your exemptions and it’s worth mentioning again that you must be completely transparent or risk seriously complicating or compromising your filing.
The Meeting of Creditors 30 Days After Filing
Once your paperwork has been filed with the courts you are protected under Automatic Stay status. What this means is that all actions to collect a debt taken against you must be halted once your creditors are notified. Any garnishments or legal proceeding against you on behalf of creditors must be halted until your file has been reviewed by the courts. This will also halt the foreclosure process and it’s a great opportunity to begin practicing responsible financial planning. After your paperwork has been reviewed your case will be assigned a trustee who will administer the case. This trustee will also take possession of any non-exempt property you have at this point but this may be temporary.
Usually within thirty days of filing the trustee will hold what is known as The Meeting of Creditors. Your MN Bankruptcy Lawyer and you will meet with the trustee and your creditors should they choose to attend. If there are non-exempt assets the trustee will determine how to sell these items and divide the proceeds among the creditors. There is a chance your held assets may be determined too difficult, costly or time consuming to liquidate and the items may be returned to you. Creditors will have an opportunity to challenge these determinations. If there are no disputes among the creditors, trustee and your counsel which is usually the case you will be notified within a few months that your debts have been discharged. The process is fairly straightforward and with the help of our legal team we can assure you the best possible experience so that you can get back to success!