Brooklyn Center Chapter 7 Bankruptcy Lawyer

Being in debt can mean constant contact from creditors trying to collect their money. Even if you are working and trying to catch up with your bills, it can feel as though you keep slipping farther behind.

If this sounds familiar, it might be time to consider bankruptcy. To learn more, speak with a Brooklyn Center Chapter 7 bankruptcy lawyer at Walker & Walker Law Offices, PLLC. Our experienced bankruptcy attorneys offer free consultations and are ready to help you.

How the Means Test Determines Eligibility

Chapter 7 is for people who do not have a steady income or who work but do not earn enough to pay their bills and support themselves. This type of bankruptcy eliminates the debt of people whose assets are insufficient to pay off their creditors. If you make enough money that you could pay a considerable portion of your debt if it were restructured, you must file Chapter 13.

Our Brooklyn Center attorneys will ask some questions to determine whether Chapter 7 bankruptcy is an option for you. If your income over the preceding six months was below the median for similar households, you are presumed to qualify for Chapter 7.

If your income is above the median, a means test determines your eligibility. This test considers your income from all sources and deducts necessary expenses, which are those essential for your health and well-being. Your eligibility to declare Chapter 7 depends on the amount of income you have left after deducting necessary expenses.

Will You Lose Your Possessions in Chapter 7 Bankruptcy?

Chapter 7 wipes out consumer and medical debt, but the bankruptcy trustee can sell your assets and direct the proceeds to your creditors. The law protects some of your assets from being sold to satisfy creditors. Many people filing Chapter 7 will have few, if any, non-exempt assets for a bankruptcy trustee to sell.

Minnesota Code § 550.37 lists property that is exempt from sale in a Chapter 7 bankruptcy proceeding. It includes equity in a principal residence or farm, a vehicle, home furnishings and clothing, and tools and equipment you need for your work. Other exempt items include wedding rings and some jewelry, retirement savings and pensions, books and musical instruments, and a $1,500 wild card exemption that you can apply to any asset you choose.

Most of the exemptions protect property up to a specific value. Our Brooklyn Center attorneys are familiar with the currently effective values for property exempt from Chapter 7 bankruptcy. We can use the legal exemptions strategically to protect as much of your property as possible from sale during your bankruptcy.

What Debt May Remain After Chapter 7?

If credit cards or medical debt are causing most of your financial strain, Chapter 7 bankruptcy can provide a fresh start. However, Chapter 7 cannot eliminate debt relating to:

Child support
Spousal support (alimony)
Most tax debt
Recently purchased luxury items
Liabilities from a personal injury lawsuit

Bankruptcy also does not erase criminal fines or court-ordered restitution.

If you want to be free of student loan debt, our Chapter 7 bankruptcy attorney in Brooklyn Center must file a lawsuit within your bankruptcy, called an adversary proceeding. This lawsuit requires you to prove that you will suffer financial hardship if you must repay your student loan.

Reach Out to a Brooklyn Center Attorney About Chapter 7 Bankruptcy

If your financial situation feels overwhelming, Chapter 7 bankruptcy can bring relief. A Brooklyn Center Chapter 7 bankruptcy lawyer can guide you through the process. Consultations are always free at Walker & Walker Law Offices, PLLC, so reach out today to schedule a time to speak with us.