Guidelines for Filing Chapter 13 in Minnesota

By Heather Frances J.D.

Personal bankruptcy can help Minnesotans with heavy debt loads get some relief and a financial fresh start. Most aspects of Chapter 13 bankruptcy proceedings are governed by federal bankruptcy rules rather than Minnesota state law, but some areas of bankruptcy are state-specific, such as where you must file your petition and which exemptions apply to your case.

Chapter 13

Chapter 13 is a form of personal bankruptcy that involves reorganization of your debt under the terms of a three- to five-year repayment plan. Unlike Chapter 7 bankruptcy in which most debts are wiped out, Chapter 13 filers must make payments on their debts over the course of the repayment plan; debts remaining at the end of the repayment period may be wiped out if they have not been fully paid. Thus, Chapter 13 allows filers to keep their property, catch up on mortgage payments and even halt the foreclosure process on a home. The repayment plan is central to a Chapter 13 case, which may take up to five years to complete.

Filing Chapter 13

Before you file for bankruptcy in Minnesota, you must attend an approved pre-bankruptcy credit counseling course. Bankruptcy cases are handled by federal bankruptcy courts, so you must file your petition in the U.S. Bankruptcy Court for the District of Minnesota. This court has offices in Duluth, Fergus Falls, Minneapolis and St. Paul. To begin your case, you must submit a petition and several other required forms, proposed repayment plan and filing fee.

Get a free, confidential bankruptcy evaluation. Learn More

Trustees

A court-appointed bankruptcy trustee manages your Chapter 13 case. He evaluates your proposed repayment plan by reviewing the forms you file, which list your creditors, assets, income and expenditures. The trustee has the authority to object to your proposed repayment plan. He will hold a “341 meeting" -- a meeting with you and your creditors -- to discuss your proposed repayment plan. At this meeting, creditors have a chance to ask you questions, but frequently do not attend.

Exemptions

Bankruptcy exemptions remove certain property and assets from sale in a Chapter 7 proceeding, but in a Chapter 13 case, the bankruptcy court also uses them to determine how much money you have available to pay certain creditors. Minnesota law allows you to choose either Minnesota’s exemptions or the exemptions available under federal law -- but not both. Minnesota’s exemptions tend to be more generous than the federal exemptions and include a certain amount of equity in your home, vehicles, clothing, furniture, appliances, books and other personal property.

Get a free, confidential bankruptcy evaluation. Learn More
Rules for Declaring Bankruptcy in Kansas
 

References

Related articles

Bankruptcy Exemption Requirements

If your debts are out of control and you have little hope of catching up on the bills, you have the option to file for bankruptcy protection. The federal bankruptcy code allows you to file under Chapter 7 or Chapter 13 of the code. In a Chapter 7 bankruptcy filing, a court-appointed trustee seizes your non-exempt property to repay your debts. In a Chapter 13 filing, the trustee sets a repayment schedule, and you are allowed to keep your property. Exemptions are an important consideration in both forms of bankruptcy.

How to File Chapter 13 Bankruptcy to Clear Child Support

Filing a bankruptcy case can help you get back on your feet financially by discharging certain debts so you no longer have to pay them. However, some debts, like child support, cannot be erased in bankruptcy, but bankruptcy can help you become current on your obligations and thereby, clear up any past due support.

The Average Cost of Chapter 7

Filing a Chapter 7 bankruptcy case may seem like a costly endeavor. The fees and costs associated with a bankruptcy filing can add up quickly, but when you consider the emotional and financial toll you might suffer by trying to pay down debts you cannot afford, the cost of a bankruptcy proceeding seems more reasonable.

Bankruptcy

Related articles

Federal Vs. State Exemption for Chapter 7

In a Chapter 7 bankruptcy, you ask a federal court for protection from creditors. The court issues an automatic stay, ...

Laws on Debt Forgiveness Through Chapter 13

When debt piles up, individual debtors may need the structure of a bankruptcy case to get back on their feet again. If ...

How to Declare Bankruptcy in Illinois

Bankruptcy can help you clean up your finances and start fresh. Declaring bankruptcy means filing a bankruptcy petition ...

Can the Court Take My Savings in Bankruptcy?

Personal bankruptcy is a legal process that allows individuals who have become overwhelmed with debt to get a fresh ...

Browse by category
Ready to Begin? GET STARTED