Chapter 7 Bankruptcy Attorney - St. Cloud, Willmar and Minneapolis

Chapter 7 Bankruptcy is referred to as the "liquidation" bankruptcy. This is by far the most common form of bankruptcy that is filed. Chapter 7 is available to individuals, married couples, partnerships, and corporations. Individual debtors are usually granted their discharge within 90 days of the date of filing. Most of the people who qualified for a Chapter 7 under the old laws will still qualify today under the Amended Rules of 2005.

In order to qualify for a Chapter 7 Bankruptcy, you cannot have filed for a previous Chapter 7 within the past eight years, you must be able to pass the Chapter 7 "means test," and your budget only allows you to pay for your monthly living expenses. If you qualify, you may be able to discharge most of your credit card bills, medical bills, repossession deficiencies, and older taxes.

Filing for Chapter 7 initiates the "automatic stay" – which is an immediate protection for you. It will stop wage garnishments, creditor harassment, and will provide temporary relief to home foreclosure proceedings and car repossessions. Most mortgage companies and automobile lenders will continue to accept monthly payments on the debts owed to them, as long as you remain current.

There are certain debts that a Chapter 7 Bankruptcy does now allow you to discharge. Some of these debts include:

• Recent taxes
• Student loan debt
• Child support obligations
• Spousal support obligations
• Debts not listed in the Chapter 7 Petition
• Credit that was obtained from fraud
• Debts with co-debtors – your co-signer will be on the hook for the full amount of the debt unless they also file bankruptcy

If you are behind on your mortgage payment or car loan a Chapter 7 will not bring you current. However, there my be other options available to you.

It is also important to keep in mind that a Chapter 7 Bankruptcy may not protect all of your assets. If you own multiple homes with a lot of equity in them, one will probably be sold by the trustee in order to pay some of your creditors. If you find yourself in this type of situation, where you have unprotected assets that you want to keep, it may be better to look into a Chapter 13 payment plan.