If you’ve read up on what Chapter 13 Bankruptcy is, and why Chapter 13 Bankruptcy could work for you, then you might be asking yourself, is Chapter 13 Bankruptcy right for me?
Perhaps you are unsure whether you qualify for Chapter 7 Bankruptcy, or whether you can still keep your property.
Here’s our quick guide to when Chapter 13 is right.
1. You have debts not dischargeable under Chapter 7 Bankruptcy
If you have debts that aren’t dischargeable under Chapter 7 Bankruptcy such as a marital property division, then Chapter 13 Bankruptcy might be right for you.
2. You have liens larger than the value of your assets
Perhaps your home is underwater as you owe more on your mortgage than your house is worth due to the recession.
You might owe more on your car payments than your car is worth. Perhaps you bought a brand new car that depreciates fast, which is now worth a lot less than you paid for it.
You are behind on car or mortgage payments
If you’re behind on your car or mortgage payments, then Chapter 13 Bankruptcy might enable you to keep your car or home.
This will obviously keep you and your family in your home, and enable you to get to work to pay off your debts.
You have assets worth more than the allowed exemptions
If you have assets worth more than the allowed exemptions then Chapter 13 Bankruptcy might be the best way for you to get out of your financial situation.
In Minnesota, the bankruptcy exemption laws are quite generous, but if you have something like a cabin or an expensive collector car, then Chapter 13 will probably allow you to keep it where Chapter 7 would not, assuming you pay enough to your creditors.
You think your income is too high for a Chapter 7 Bankruptcy
If you make more than the median income for a household of your size in Minnesota, then you usually are not allowed to file Chapter 7, but may still file a Chapter 13 bankruptcy.
Even wealthy people, or those on a seemingly high monthly income can spend more than they earn, meaning that they can suffer the same sort of financial problems as those on much lower incomes.
Although we try and explain the differences, so you can ask yourself and a bankruptcy attorney is Chapter 13 Bankruptcy right for you, we know that no two cases are the same.
We know that there is no substitute for speaking to an experienced Minnesota Bankruptcy Attorney and discussing your individual circumstances and situation.