Unexpected Debt and Minnesota Bankruptcy

Posted by Kelsey Quarberg on December 20, 2017 at 2:20 PM
Kelsey Quarberg

facing unexpected debt.jpgHas Mother Nature caught you off guard with unprecedented winter storms?

No matter how prepared you think you are for winter, chances are when an unexpected snowstorm hits, you find that there was something you forgot: extra batteries, driveway salt, or the ever-important loaf of bread and gallon of milk may make the difference between enjoying the winter wonderland outside or cursing the swirling white fury outside your window.

As bad as it is to be caught off-guard by a freak snowstorm, being unprepared for unexpected debt can be potentially devastating to a family’s finances. Whether because of job loss, economic downturn, illness, death, divorce, or just a couple bad financial decisions, overwhelming debt can strike Minnesota families at any time.

If your family experiences unexpected debt, do you know what your options are?

Erase your unexpected debt with Chapter 7 or Chapter 13 bankruptcy

Whether your unexpected debt is relatively small or you’re being overwhelmed by tens of thousands of dollars in unpaid bills, bankruptcy is a great option for erasing your debt. Almost all types of unsecured debt are dischargeable in bankruptcy: common examples include major credit card balances, medical bills, and retail store accounts.

For over 50 years, our law firm has specialized in two kinds of bankruptcy: Chapter 7 and Chapter 13.

Chapter 7 bankruptcy is known as the “fresh start” bankruptcy because it is designed to give families a new beginning by eliminating all their unsecured debt fast. While not all families meet the income requirements to qualify for Chapter 7, those that do will be able to walk away from their outstanding debt in as little as 90 to 120 days from the date of filing.

For those families that don’t qualify for Chapter 7 or want to keep their big-ticket items like their house and car, Chapter 13 is the best bankruptcy option. Depending on the unique circumstances of your case, you will be given a 3 to 5 year repayment plan made up of payments that are based on what you can afford. At the end of your repayment period, any remaining debt is discharged.

Each Minnesota family’s financial situation is unique: as such, you should always consult with a qualified Minnesota bankruptcy law firm to help you determine which type of bankruptcy is right for you. By scheduling your free initial consultation, one of our highly skilled bankruptcy specialists will determine whether Chapter 7 or Chapter 13 is most appropriate based on a review of your basic financial information.

Minnesota bankruptcy and your credit score

Did you know that when you discharge your debt with bankruptcy that your credit score remains the same? A common misconception is that by filing bankruptcy you are getting rid of your debt and rebooting your credit score in one fell swoop – not true!

Perhaps just as bad as being caught off guard by unexpected debt, when your financial situation causes your credit score to plummet, the long-term effects can seriously impair your ability to obtain financing and even impact your ability to be hired for certain types of jobs.

Your credit score is a three-digit number that reflects your financial health and the probability of you being able to repay your lines of credit. When you carry high balances, miss too many payments, or make other credit mistakes, your credit score can drop quickly and raising it on your own is a long and slow process. Without a robust credit score, it is unlikely that you will be able to obtain a line of credit should your situation worsen or more unexpected events impact your financial stability.

At Kain & Scott, we understand that giving you a new financial future takes more than just erasing your debt: you also need to repair your credit. With our exclusive Free 90 Day Credit Repair Program, you can learn what you need to do to start repairing your credit fast and obtain financing from our list of trusted Minnesota lenders.

Once your debts are discharged and your credit is repaired, your family can breathe a sigh of relief: you’ll never have to worry about unexpected circumstances threatening your family’s financial stability again.

How to get started on your bankruptcy

To get started filing for bankruptcy and repairing your credit, visit us online at www.kainscott.com to schedule your free initial consultation. We understand that our clients lead busy lives so we offer several consultation options to best suit your schedule: via telephone, Skype, or Facetime, from the comfort of your own home.

Don’t let unexpected circumstances determine your family’s financial future: contact Kain & Scott to schedule your free no-obligation initial consultation today!

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Topics: Bankruptcy, Chapter 13, Chapter 7, Debt