If you are unable to meet your monthly debt payments and don’t know how to get yourself out of your current financial situation, bankruptcy might be a valuable option for government-addressed debt relief. Filing for bankruptcy is a process that’s frequently given a negative image, primarily because of the impact it has on your credit score, but in fact, bankruptcy often has a positive long-term effect on your financial standing. Petitioning for bankruptcy and working through the filing process may seem daunting, and it is a nuanced legal procedure. However, with the help of a professional bankruptcy attorney, you can put together a strong, successful case for Chapter 7 bankruptcy in Pipestone, MN.
Chapter 7 bankruptcy is one of the most common bankruptcy chapters individuals and businesses file for in the United States. The process of Chapter 7 bankruptcy works to liquidate your non-exempt assets (properties) in exchange for discharging (dissolving) your debts. If your income is lower than the amount you are required to pay for your current monthly debts and your reasonable and necessary living expenses, you qualify for Chapter 7.
While Chapter 7 seems like a last gasp for many, largely because of the liquidation process, it’s not a process designed to leave you destitute. While some of your assets could be sold or liquidated, that is the exception rather than the rule. Most people who file for bankruptcy relief can and do protect and keep their properties with their allowed bankruptcy exemptions.
Exemptions are a key part of the filing process for Chapter 7 bankruptcy. The U.S. Bankruptcy Code provides exemption allowances for many of your properties, from your home and car to your small personal property items. The current Minnesota exemptions include:
- Homestead: Up to $420,000 for most homes (non-agricultural use) or $1,050,000 if the home is used primarily for agricultural purposes.
- Insurance: Including accident, disability, and life insurance for a spouse and dependent beneficiaries as well as fire and police beneficiaries.
- Trade Tools: Including agricultural equipment, livestock, and crop stores up to $13,000 in value; teaching materials and other tools of trade up to $12,000.
- Wages: 75% of your earned, unpaid wages within the past six months; wages earned within six months of release from prison; and wages paid within six months of employment after welfare.
- Personal Property: Including appliances, furniture, radios, and TVs up to $10,800; burial plots, church pews, clothing and watches, food, utensils.
- Public Benefits: Including compensation for crime victims, unemployment, and workers’ as well as veterans’ benefits.
- Miscellaneous: The wages of your child under 18, ERISA-qualified benefits and IRAs under $72,000, and property of partnership businesses.
- Vehicle. Value in a motor vehicle of up to $4,800.00.
The preceding list denotes just some of the many exemptions you can claim in a Chapter 7 case. First and foremost, bankruptcy is designed to be fair to you and your creditors alike. The court does not want you to be left with nothing, and so exemptions allow you to protect your property during a Chapter 7 liquidation.
To learn more about filing for Chapter 7 bankruptcy in Pipestone, MN, contact Behm Law Group Ltd. at (507) 387-7200 today.