Types Of Bankruptcies You Can File In Minnesota

Posted by Wesley Scott on April 23, 2019 at 5:41 PM
Wesley Scott

what happens when you file bankruptcy - chapter 7 exemptionsFour types of bankruptcy are available under federal law. They are each intended for different types of debtors and are outlined in Chapter 7, 11, 12, and 13 of the Bankruptcy Code.

Chapter 7 bankruptcy is often called ‘clean slate’ bankruptcy because almost all the debtor’s debts will be wiped away in a few months. This bankruptcy chapter is for debtors who will never be able to pay their existing debts. Only debtors who make less than the median income in their state for their family size qualify for this type of bankruptcy.

Chapter 13 bankruptcy is the other consumer bankruptcy option and involves paying off some or even all of the debt over a period of three to five years. The bankruptcy court must approve the repayment plan; the payment plan may be modified over the course of repayment if the debtor’s financial situation changes. After all the payments are made, the remaining debt is generally discharged. A Chapter 13 bankruptcy can be converted into a Chapter 7 bankruptcy.

Chapter 11 bankruptcy is typically for businesses. If a company declares bankruptcy, this is the chapter it is filing under. Chapter 11 bankruptcies are also available to consumers, but its provisions are quite complicated for an individual.

Chapter 12 bankruptcy is a specialized type of bankruptcy for family farmers and fishermen. A bankruptcy under this chapter operates very much like a Chapter 13 bankruptcy but is for people whose income comes from a family farm or commercial fishing.

Kain & Scott deals exclusively in Chapter 7 and Chapter 13 bankruptcies—it is all we do! At an initial consultation, we will help you determine which type of consumer bankruptcy is best for you.

When the time is right reach out to Minnesota’s NICEST bankruptcy law firm at www.kainscott.com.  You will be so happy you did!

 

 

 

 

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