Legal Question in Bankruptcy in Minnesota

Pre-Filing Asset Planning

In the state of MN, if I took all my non exempt liquid assets (money market, mutual funds, etc.) and paid my mortgage on my first house (increased my equity which I understand is exempt up to $100,000 in MN) would this present a problem for my bankruptcy petition.

And, on what grounds might the judge look at my income and decide that I could afford to keep paying the mortgage. How likely is this.


Asked on 4/07/98, 3:06 pm

1 Answer from Attorneys
Mark Sullivan Mark R. Sullivan - Attorney at Law

Homestead exemption and planning

I really don't know enough to advise you properly. I don't know if your state uses the federal exemption scheme or the state exemptions. If your income is sufficient, the trustee or someone else, may try to convert your case to a chapter 13 if you file as a chapter 7. What you spoke of in changing the character of non-exempt assets to exempt assets is usually good bankruptcy planning. You need to consult with a competent local bankruptcy attorney to assist you in your planning. Timing of the filing may be extremely important and there are other issues that a competent attorney will be able to spot and will assist you in avoiding some of the pitfalls that trap the unwary. Good Luck.

If we have not met face to face and agreed to my representation of you in a written agreement signed by both you and I, then I am not your lawyer. Any comments made here are not legal advice but presented in the spirit of this bulletin board as general information only.

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Answered on 4/21/98, 12:34 pm


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