Bankruptcy Overview
If you’re feeling overwhelmed by debt, the protections offered under the U.S. Bankruptcy Code can offer a way out and give you the fresh financial start you need. At Sieling Law, PLLC, we help clients in Minnetonka, Eden Prairie and the surrounding areas explore their bankruptcy options, including Chapter 7, Chapter 13, and Chapter 11. Filing for bankruptcy can provide immediate relief from creditor harassment and give you a structured path to resolve your debts. Take advantage of a free consultation with Mary, a bankruptcy lawyer who can help you understand which type of bankruptcy is best suited for your unique situation.
The Automatic Stay: Immediate Relief from Creditors
One of the most powerful benefits of filing for bankruptcy is the automatic stay. As soon as you file, an automatic stay goes into effect, stopping most collection actions against you. This means creditors must halt phone calls, wage garnishments, lawsuits, and foreclosure proceedings. The automatic stay provides immediate relief, allowing you to focus on resolving your debts without the constant pressure from creditors. However, some exceptions apply, so take advantage of a free consultation with a knowledgeable bankruptcy attorney to learn exactly how the law will apply to your situation.
Chapter 7 Bankruptcy: A Fresh Start
Chapter 7 bankruptcy, also known as “liquidation bankruptcy,” is designed for individuals who have little to no disposable income and are unable to pay their debts. By filing for Chapter 7, you can eliminate most unsecured debts, such as credit card debt, medical bills, and personal loans, giving you a clean slate. In many cases, you can keep essential assets like your home, car, and retirement accounts, thanks to bankruptcy exemptions. This process is typically completed in a few months, allowing you to quickly move forward with your financial future.
Chapter 13 Bankruptcy: Reorganization for Those with Income
Chapter 13 bankruptcy, also known as a “wage earner’s plan,” is ideal for individuals who have a steady income but are struggling to keep up with their debts. Instead of wiping out your debts entirely, Chapter 13 allows you to reorganize them into a manageable repayment plan that lasts three to five years. This type of bankruptcy can help you catch up on missed mortgage or car payments and even reduce the balances of certain unsecured debts. At the end of the repayment period, some debts may be discharged, allowing you to move forward with a reduced financial burden.
Chapter 11 Bankruptcy: Business and High-Debt Reorganization
While Chapter 11 bankruptcy is typically associated with businesses, it is also available to individuals with significant assets or large debts that exceed the limits for Chapter 13. Chapter 11 provides a way to reorganize debts while continuing to operate a business or maintain control of your financial affairs. Though more complex and time-consuming than other types of bankruptcy, Chapter 11 can be a powerful tool for individuals or businesses that need a structured repayment plan to overcome financial difficulties.
Medical Debt and Bankruptcy
Medical bills are one of the leading causes of financial distress in the United States. Whether you’ve experienced a sudden illness, injury, or ongoing health issues, the cost of medical care can quickly spiral out of control. Bankruptcy can help you eliminate or significantly reduce medical debt, giving you the relief you need to focus on your health and recovery instead of constant financial pressure. In Chapter 7 bankruptcy, medical debt is typically discharged, while in Chapter 13, it can be reorganized into a repayment plan.
Student Loans and Bankruptcy
Although student loans are generally difficult to discharge in bankruptcy, it is not impossible. In some cases, if you can prove that repaying your student loans would cause undue hardship, you may be able to discharge some or all of your student loan debt. This requires additional legal steps beyond the regular bankruptcy process, so it’s important to work with an experienced bankruptcy attorney to determine if this option is available to you.
Talk to a Bankruptcy Lawyer
If you are struggling with debt, take advantage of a free consultation with Mary, a bankruptcy lawyer who will listen to your situation and then help you evaluate your options. Filing for bankruptcy can provide significant financial relief and a path toward a more secure future. At Sieling Law, PLLC, we offer personalized bankruptcy services to individuals and businesses in Eden Prairie, Minnetonka and the surrounding areas. Our team is here to help you navigate the bankruptcy process and ensure your rights are protected every step of the way.
Contact Sieling Law, PLLC
If you’re considering bankruptcy and want to learn more about how it can help you overcome your financial challenges, contact Sieling Law, PLLC today. We offer free consultations to discuss your situation and determine the best path forward. Call us at 612-325-1191 or fill out our online form to get started.
