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Minnesota Chapter 13 Bankruptcy Lawyer
St. Pual Debt Relief Counseling
Chapter 13 bankruptcy is a structured payment plan monitored by the government. Unlike a private debt consolidation company, your creditors must agree to the plan and you can avoid foreclosure and repossession of your property. To file for Chapter 13, you must be a naturalized citizen with a regular source of income and unsecured debts under $307,675. Your secured debts must be under $922,975. Other restrictions apply, so it is best to check your specific circumstances with a Minneapolis Chapter 13 bankruptcy attorney before you attempt to file.
Under a Chapter 13 plan, you will need to submit a list of all of your assets, debts and a payment plan to the bankruptcy court. Generally these payment plans will take place over three to five years, depending on your income level and amount of debt. Throughout this time, any extra disposable income you earn must be applied to your debts. A Minneapolis Chapter 13 bankruptcy lawyer can be helpful in drafting your payment plan, as they have the experience to understand what plans the court will approve.
While your plan is being approved, you will receive a stay of action against your creditors, meaning they cannot contact you regarding your debts during this time. If you are harassed by any creditors at this time, contact our St. Paul debt relief counseling attorneys. You may be able to sue the harassing creditors for violating the stay.
Your creditors with unsecured debts must accept the court’s approval of your plan. Any creditors of secured debts can continue to accept payments on the property or you may surrender the property and transfer the balance of debt to your group of unsecured debts.
If you follow your payment plan through the end of its term, your unsecured debts will be dissolved, even if you have not paid them in full. Your secured debts will return to their original payment structure, which will likely be easier to pay off once all of your unsecured debts are dissolved.
After your bankruptcy, you may have a harder time applying for credit, as the mark will remain on your record for the next ten years. If you have any other options outside of Chapter 13, a Minneapolis bankruptcy lawyer from our law firm will help you to evaluate your possible choices. Contact us today.