Minnesota's Bankruptcy Law Firm for More Than 35 Years
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Many debtors come to our Prescott & Pearson, P.A., law offices with the idea that Chapter 7 bankruptcy is the more desirable bankruptcy and they feel let down when they learn that they are eligible for Chapter 13 bankruptcy but not for Chapter 7. In fact, however, individual circumstances indicate which type of bankruptcy is right for each client — and sometimes the advantages of Chapter 13 make it more desirable.
Advantages of Chapter 13 bankruptcy for our Minnesota clients include the following:
- In a Chapter 13 bankruptcy, a large number of debts may be consolidated and reorganized, resulting in one affordable monthly payment payable for three to five years.
- In many cases, only a portion of the outstanding debts is repaid in a Chapter 13 bankruptcy, generally with no interest.
- Chapter 13 bankruptcy is available for debtors whose incomes exceed the median income of Minnesota and they have failed the means test.
- Some debtors feel better about the fact that in Chapter 13 bankruptcy, they repay what they can afford to repay on some or all of their debts, rather than "just walking away" from debts that they had originally signed and agreed to repay.
- Generally, in Chapter 13 bankruptcy, a debtor is reassured of being allowed to keep all property. None will be liquidated as is sometimes the case in a Chapter 7 bankruptcy, as long as the Chapter 13 plan is properly constructed.
- A Chapter 13 bankruptcy may cover certain types of debts that are not allowable in a Chapter 7 bankruptcy.
- It is very likely that a debtor will be able to keep secured property (including a house and car) in a Chapter 13 bankruptcy. When a home has high equity — too much to include in a Chapter 7 bankruptcy — this is an advantage for debtors who hope to keep their homes.
- A Chapter 13 bankruptcy protects co-signers of consumer debt, whereas a Chapter 7 bankruptcy does not.
Is Chapter 13 bankruptcy right for you? It may be advantageous for your circumstances. Discuss your concerns and objectives with an experienced Minnesota bankruptcy lawyer at Prescott & Pearson, P.A.
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- Minneapolis-St. Paul Area: 651-968-8096
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To learn more about advantages of Chapter 13 bankruptcy, call or contact our bankruptcy lawyers today. We offer free initial consultations, quality services at competitive rates and effective representation statewide.