At Kain & Scott, our team of bankruptcy specialists are out in the real-world talking to real people about bankruptcy every day. After thousands of conversations with Minnesota residents, there are certain questions that come up over and over again in our discussions that, although the answers have a significant impact on the lives of those who are Filing Bankruptcy seem to be off-limits and therefore never addressed on most bankruptcy websites.
Based on our conversations with countless clients, we’ve compiled a list of “taboo” questions we hear every day from Minnesota residents in the hopes that, by educating yourself and your family on these important issues, you can better understand the benefits of filing for bankruptcy in Minnesota.
Are bankruptcy records public?
The bad news is that, yes, bankruptcy records are public. The good news is that the records aren’t easily attainable and, therefore, most people wouldn’t know how to access them.
There is a common fear among our clients that if they are Filing Bankruptcy “everyone will know!” This is simply not the case. Bankruptcy records are public in that, should a member of the public want or need the information and are willing to pay for it, they can be accessed though a database called PACER. To access the database, you would first have to know it existed (which most people outside of the legal or financial sectors don’t), register for access, and pay for each page of the documents you wish to view. So, technically yes, the records are public; but the odds of nosy Steve from the YMCA finding out is pretty unlikely.
will Bankruptcy stop an eviction Or foreclosure?
Generally speaking, after filing bankruptcy you enter a period of “automatic stay”: imagine a giant pause button being pressed that freezes your creditors in place and prevents them from pursuing collections actions against you.
However, as with any general rule, there are exceptions. For evictions, if your landlord received an eviction order before you are file bankruptcy, the landlord can ignore the automatic stay period and continue with eviction. Foreclosures, on the other hand, will almost always be paused. It’s important to know that in order to pause the foreclosure, the sale must not have taken place prior to filing. Assuming that the bankruptcy is filed before the sale, the foreclosure process will stop unless the lender asks the court to allow them to ignore the automatic stay and proceed with foreclosure. Remember that Chapter 7 bankruptcy differs from Chapter 13: in most cases, clients can keep their homes under a Chapter 13 repayment plan.
Will filing bankruptcy affect my job?
The short answer is, it depends on what type of job you have.
If you are employed in the financial, legal, or other sector where you have a fiduciary duty to others and your own finances reflect your ability to handle money for others, then bankruptcy could affect your job. With any other type of job however, it is unlikely that your boss will know or care that you filed for bankruptcy. And the bankruptcy law protects people who have filed from discrimination in the workplace.
Will Chapter 7 bankruptcy get rid of all my debts?
While filing bankruptcy will eliminate many types of debt and make a drastic difference in your finances, there are some debts and obligations that are exceptions to the discharge and can’t be erased under this type of bankruptcy.
There are three types of debt: secured, priority and unsecured.
Secured debt gets its name from the fact that the credit extended to you is “secured” by collateral. Think of your auto loan or home mortgage: in both instances, the item itself is the guarantee that you will pay the credit you owe, or else the creditor can reclaim (through repossession or foreclosure) what it gave to you.
Priority debt includes most tax debt and domestic support obligations, such as child support and alimony payments. Priority debts are paid before any other creditors get paid in cases where the trustee has money to distribute to creditors. Some, but not all priority debt cannot be discharged.
Unsecured debt, on the other hand, is the opposite of secured debt in that the credit itself isn’t attached to a specific item that can be reclaimed by the creditor. Your credit card is an example of this: the creditor extended you a $1,000 line of credit, for example, but instead of giving you a physical item, you only received an intangible line of credit. Medical bills, credit cards, and other forms of unsecured debt can be completely eliminated by filing for Chapter 7.
How do I know if filing for Chapter 7 is right for my family?
Filing for Chapter 7 is a big decision and shouldn’t be taken lightly. There are many things to consider and filing can affect your finances for years to come. However, being able to eliminate thousands of dollars in unsecured debt can transform lives and give struggling families a much-needed fresh start.
If you are considering Filing for Chapter 7 Bankruptcy in Minnesota, contact the experienced and friendly bankruptcy specialists at Kain & Scott today at www.kainscott.com to schedule your free no-obligation consultation from the comfort of your own home via Skype, telephone, or Facetime.