The residents of Minnesota have long been known for maintaining an especially proud reliance upon their families and their specific communities above and beyond the assistance of the federal government regardless of the necessity. From the bad lands to the boundary waters, Minnesotans have ever frowned upon the assistance of external authorities: as they say, Minnesota isn’t just one of the United States, it’s a state of mind. All the same, in these trying times of economic tumult, no part of the population is autonomous in the scope of the global financial crisis that has brought real estate markets across America spinning to their knees. At present, there are as many families on the brink of bankruptcy as there are lakes in Minnesota, and, much as the citizens of our state like to imagine themselves set apart from the larger economic struggles, there’s a real and demonstrable need for the governmental protection that the Chapter 7 and Chapter 13 bankruptcy programs represent. Unfortunately, since so many Minnesota families never imagined that they would ever require the assistance of bankruptcy protection and, in this way, never bothered to learn much more about bankruptcy than that by utilizing the system their credit ratings would be ruined, their possessions could be seized for auction, their future employment opportunities or chance of decent home loans could be threatened, and that, if there is absolutely any possible alternative against bankruptcy, they do not want anything to do with the plan.
Alas, as the economy of Minnesota continues to spiral down the same drain as the rest of the western world, there might not necessarily be another realistic choice for Minnesota households desperate to keep their family residence and avoid wage garnishment beyond bankruptcy. In any event, Minnesota borrowers should at least do everything that they can to learn more about the programs in case Chapter 7 or Chapter 13 bankruptcy would be considered advisable or even virtually obligatory given the right set of financial conditions. The people of Minnesota aren’t actually that far different than the rest of America when it comes to the massive amounts of unsecured debt they have collected over the last decade: somewhere between twelve and fourteen thousand dollars per Minnesota household, depending on which study you wish to believe, held on at least six different credit accounts. Now, of course, not every borrower in Minnesota arrived at this predicament because of foolish spending choices or problem buying habits. While a good number of Minnesota families, the same as elsewhere around the United States, did lose track of the family budgets in the manic rush for purchasing that characterized the past few years – credit card debts growing larger and larger even as the wealth of the nation and the average income of Minnesota residents increased along side – the rising costs of health care and the diminishment of insurance options in the changing status of Minnesota industry also negatively impacted many households that helplessly saw their debt load expand exponentially following even the brief hospitalization or relatively minimal medical procedure required to aid a family member.
As such, the need for some form of debt management should be obvious no matter how much the Minnesota family may want to just repay their loans the old fashioned way. Shoring up the family budget, tightening the purse strings, and taking out a second job to pay down the collected bills just might not be a realistic option for every Minnesota family any more, and learning more about the availability of debt liquidation or debt reorganization programs such as Chapter 7 and Chapter 13 bankruptcy should be thought of as a priority for the cost conscious Minnesota household. There are other plans than bankruptcy, of course, but, by dint of tradition and name recognition, bankruptcy should be the first place that the Minnesota borrower should start on the road to debt freedom. In the following article, your authors – who have spent decades working with Minnesota families in their fight against unsecured debt and educating households about the various plans for debt relief and the elimination of credit card burdens – will explain a little more about the process of bankruptcy. Even if turns out that bankruptcy is not the perfect solution for each Minnesota debtor, there should be nothing to fear about learning a little more about any method of debt liquidation of such potential benefit for families whose productive capacities have been otherwise debilitated and whose futures may be compromised by the threat of unsecured debt loads impossible to satisfy.
Once again, regardless of how often name checked bankruptcy may be in Minnesota households (if even as a worst case scenario or example of what not to do), few debtors actually understand anything about the formal process. Take the 341 meeting, for example: so named because this extremely important aspect of bankruptcy protection is buried within Chapter 341 of the United States Bankruptcy Code. All individual consumers in Minnesota deemed appropriate for Chapter 7 or Chapter 13 bankruptcy protection will eventually have to attend this meeting of the creditors. The reigning authority present shall be the trustee previously chosen by the Minnesota courts to administrate the bankruptcy proceedings and, though the 2005 legislation has greatly diminished the powers of the court trustee to bend guidelines and restrictions for deserving borrowers, determine whether or not the household could qualify for the Chapter 7 debt elimination bankruptcy program. Much of the actual deliberation takes place behind closed doors, of course, as Minnesota county officials oversee every line of the bankruptcy petition and evaluate the worthiness of the claim. Proper and accurate composition of the borrowers’ petition should be of the utmost importance, still, and the paperwork must be filled out with the greatest attention that Minnesota families can muster however unnerving their day to day grievances. Honestly, given the likelihood of criminal penalties assessed for mistaken or misunderstood documentation – regardless of the borrowers’ intent – unprepared residents of Minnesota should be extremely careful at all points along the line to ensure that nothing about their bankruptcy paperwork could potentially be deemed suspect.
Presuming the bankruptcy petition passes the appraisal of the Minnesota county officials which analyze all of the borrower’s credit history and household income, the trustee shall then judge the legitimacy of the bankruptcy declaration through an inquiry process ensuring that all of the Minnesota filer’ assets and obligations were accurately recorded alongside the potential windfalls such as a coming inheritance. If the borrowers had already contracted the services of an experienced bankruptcy attorney licensed in the state of Minnesota, the lawyers should have prepared their clients for all of these questions and even undertaken a mock interrogation to fully get them ready for the Minnesota courts. Not only will this aid the Minnesota borrowers in terms of allowing them to be comfortable within the judicial setting, but the preparation should also help make sure that all potential trouble issues for the Minnesota household have already been dealt with prior to the event. Still, though, the 341 meeting should be seen as something of a formality. For ordinary Minnesota consumers, most lenders won’t even send out their representatives to ask questions of the borrowers, and the hearing should go by in no time at all. Nevertheless, with every aspect of bankruptcy protection so very important for the Minnesota consumers attempting debt liquidation or re-organization, interested debtors should take every precaution to arrive on time – even showing up to the federal court house or federal building, depending upon the borrower’s specific Minnesota residence, well before the hearing – so that they do not arouse undue mistrust among the court officials. At the same point, remember that, no matter where the 341 meeting will be held, there will be a security checkpoint, and any unnecessary metallic object or anything untoward that should not be checked should not be brought along. Once again, nobody attending a meeting officiated by court trustees in Minnesota or anywhere in the United States should find fault with additional time for preparation.
As we have written over and over again in the previous paragraphs, we do appreciate how very opposed Minnesota borrowers, born and bred to beware lenders and borrowers both yet nonetheless enmeshed within a larger culture that helplessly demands consumer credit for social advancement, may be to the very notion of Chapter 7 or Chapter 13 bankruptcy protection. Considering the mental difficulties and philosophical problems that the Minnesota household will have to overcome just in order to recognize the need for governmental assistance through bankruptcy, Minnesota borrowers may be even more prone to depression and surrender upon discovering that they do not qualify for help after the legislation of 2005. The Bankruptcy Abuse Prevention and Consumer Protection Act prohibits borrowers that make more then the median income of their state from attempting Chapter 7 debt liquidation under normal circumstances. For a region enshrined in story and song as boasting children above average, median income may also run contrary to the Minnesota temperament, but single borrowers who earn above forty five thousand dollars (sixty thousand for households with two members, seventy thousand for three members, and so on) are going to find it exceedingly difficult to qualify for Chapter 7 bankruptcy. There’s a separate means test supposedly intended to push Minnesota borrowers that earn too much money but nevertheless have unbearable debt loads into the Chapter 7 bankruptcy program, but, since that means test depends upon Internal Revenue Service calculations of average expenses for Minnesota households that are ridiculously inappropriate for actual families’ day to day budgets, Minnesota debtors who have held decent jobs for the past few years should almost simply assume that they will not be admitted into the Chapter 7 bankruptcy system.
However, even though bankruptcy protection may no longer be available for every Minnesota resident, the borrowers of our state should not lose hope. Even before the legislative malfeasance of 2005, debt settlement specialists had slowly started to identify and exploit the new realities of credit accounts for ordinary members of American society, and, as the limitations of modern bankruptcy become increasingly recognized throughout Minnesota, debt settlement negotiators endeavored to fill the void created by the neglect of the public and the need for substantial recourse of unsecured debts. These are extraordinary times which call for unprecedented measures, and the new services that the debt settlement alternative offers should be explored. With Chapter 7 and Chapter 13 bankruptcy protection evidently incapable of meeting the needs of the Minnesotan citizenry regardless of their financial pressures and mounting consumer debt – and with the falling property values around Minnesota disabling the home mortgage debt consolidation ventures and the shell game of Consumer Credit Counseling companies largely discredited by the increased understanding that these firms are supported by the credit card industry – the debt settlement alternative genuinely should be researched and investigated by even those borrowers who are not yet facing default or foreclosure.
Since it’s a new industry, one that depends utterly upon the expertise of certified professionals (the grand majority of whom shall be located outside the boundaries of Minnesota communities), debt settlement negotiation may seem at first startlingly different from the formalized guilt and layers of regimentation written between the lines of the United States bankruptcy code. The debt settlement industry remains so very new, especially when set aside the more or less ubiquitous tales of bankruptcy that Minnesota consumers may encounter – whether searching for information around the office water cooler or avoiding stories from a brother in law over family dinner – that many of our more traditional Minnesota citizens will instinctually turn a blind eye. Nevertheless, unsolicited advice from amateur financiers with some amount of vanity to be gained from over stating their success in bankruptcy protection or similar debt satisfaction maneuvers should hardly be seen as the wisest course of action. To truly benefit from the results of formal approaches intended to address consumer impediments, the Minnesota citizenry will have to look beyond the outmoded institutions – including, one could now say, Chapter 7 bankruptcy protection – hard working citizens stricken by financial burdens have employed throughout the long history of our state and see how the finances of their family can be preserved for the long economic winter to come.
The decision to reach out for help with your debt is not one that's easy to make. You were raised to "do the right thing", but now it’s nearly unbearable. You struggle along while your creditors are turning up the heat. And now you’re at the point where the late fees, penalties and interest expense make it impossible to keep your head above water.
Ask yourself this. If you could eliminate your debt without permanently damaging your credit, why wouldn't you?
