Common Questions About Bankruptcy in Minnesota
Q: What is the difference between Chapter 7 and Chapter 13 bankruptcy? A: Chapter 7 bankruptcy is also known as liquidation bankruptcy and involves the sale of your assets to pay off your creditors. Chapter 13 bankruptcy, on the other hand, involves the creation of a repayment plan to pay off your creditors over a period of three to five years.
Q: Can I choose between Chapter 7 and Chapter 13 bankruptcy? A: Your eligibility for Chapter 7 or Chapter 13 bankruptcy will depend on a number of factors, including your income, debts, and assets. Our attorneys can help you determine which type of bankruptcy is right for you based on your specific circumstances.
Q: Will bankruptcy eliminate all of my debts? A: Bankruptcy can eliminate many types of debts, including credit card debt, medical debt, and personal loans. However, certain debts, such as student loans, tax debt, and child support payments, may not be discharged through bankruptcy.
Q: Will I lose my home or car if I file for bankruptcy? A: In a Chapter 7 bankruptcy, you may be required to surrender your home or car if you have equity above the available exemption. However, in most cases, you can keep your home or car if you continue to make payments on your mortgage or car loan. In a Chapter 13 bankruptcy, you can keep your home and car and make payments on the outstanding balance through the repayment plan.
Q: How long does the bankruptcy process take? A: The length of the bankruptcy process will depend on the type of bankruptcy and the complexity of your case. Chapter 7 bankruptcy typically takes a few months, while Chapter 13 bankruptcy can take three to five years.
Q: Will bankruptcy impact my credit score? A: It will have an impact, it depends what your score is before filing. In some cases bankruptcy will have a negative impact on your credit score. However, some people’s score can actually improve. The impact can vary depending on your individual situation. Our attorneys can help you understand how bankruptcy will impact your credit score and how to start rebuilding your credit after bankruptcy.
Q: Will I be able to obtain credit after bankruptcy? A: Yes, it is possible to obtain credit after bankruptcy. However, it may take some time to rebuild your credit and lenders may charge higher interest rates or require a co-signer. Our attorneys can help you understand your options for rebuilding your credit after bankruptcy.
These are just a few common questions and answers about Chapter 7 and Chapter 13 bankruptcy in Minnesota. Our experienced attorneys are here to answer any additional questions you may have and help guide you through the bankruptcy process.