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What A Difference A Dollar Makes: Bankruptcy Law in Mankato, MN

Mankato, MN Bankruptcy Law and Mortgage Lien-Stripping – Behm Law Group, Ltd.

Bankruptcy law can turn on a dime, or at least a dollar. Consider, for example, the “mortgage lien-stripping” clause found in Chapter 13 bankruptcy. In cases where a debtor has a home with more than one mortgage, mortgage lien- stripping may come into play, depending on a multitude of factors. Generally speaking, if a debtor owes more on their home with a first mortgage than the home is actually worth, then a second mortgage could be stripped away via Chapter 13 bankruptcy. Behm Law Group, Ltd. offers bankruptcy advice and assistance in Mankato, MN during your time of need.

However, the margin to qualify for mortgage lien-stripping can be razor thin. For example, if a home is valued at $125,000, but the debtor has a first mortgage of $130,000 and a second mortgage of $40,000, the second mortgage would qualify for mortgage lien-stripping because the debtor clearly owes more on the first mortgage alone than the home is actually worth. The mortgage lien-stripping waters become considerably less clear the closer the first mortgage and actual home value become. For example, if a first mortgage is for $130,000 but the actual home value is currently appraised at $130,001, the margin in that case is considered close enough that any secondary mortgage could not actually be entirely stripped off. Therefore, a single dollar can stand in the way of a debtor being able to discharge several thousands of dollars on a secondary mortgage.

Bankruptcy provisions such as mortgage lien-stripping can be incredibly complex and confusing, and they definitely shouldn’t be navigated by amateurs who aren’t extraordinarily well-versed in the nuances of bankruptcy law. After all, there are thousands of dollars at stake, and debt-holding entities don’t let go of thousands of dollars without putting up a huge legal fight. You need bankruptcy law professionals who can stand knowledgeably in your corner to protect your rights under the law.

The professionals at Behm Law Group, Ltd. are adept at navigating the intimidating landscape of bankruptcy filing and helping clients find their way through the bankruptcy experience. We assist clients throughout Mankato, MN, and all of Southern Minnesota, ensuring they fully understand their bankruptcy options and achieve their best possible outcomes. Contact us today!

Don’t embark on your bankruptcy path without our professional team at your side. Contact Behm Law Group, Ltd. today and start your journey out of bankruptcy.

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Defining “Undue Hardship” – Bankruptcy Law in Mankato, MN

Mankato, MN Bankruptcy Law with Behm Law Group, Ltd.

Generally speaking, discharging student loans via bankruptcy can difficult endeavor. However, when you’re facing outright bankruptcy—which can be challenging and stressful enough—it can’t hurt to explore all your options. It may surprise some people to learn there is a section of the Bankruptcy Code (11 U.S.C. Sec. 523[a][8]) which addresses student loans specifically. It basically states: “Student loans can be discharged as long as one can show that excepting [excluding] such debt from discharge (debt relief provided through bankruptcy) would impose an undue hardship on the debtor and the debtor’s dependents. Behm Law Group, Ltd. provides professional bankruptcy counsel in Mankato, MN in your time of need.

The key term here is “undue hardship,” a term which only government lawmakers could conjure that sounds ridiculously simple.  However, what constitutes “undue hardship” is a very factually intensive inquiry.  In order to establish “undue hardship”, one must review all of the circumstances surrounding someone’s financial situation.  Serious medical conditions, job losses, the likelihood of being able to get higher paying employment and one’s other living expenses and sources of income are only a few factors that need to be considered.  Discharging student loans in bankruptcy can be done and, indeed, has been done in many cases.

One example of a fact substantiating “undue hardship” is to show you’ve incurred a disability since graduating from college that prevents you from being able to realistically carry out the necessary tasks that are part of any job aligned with your college degree. Let’s say you graduated with a degree in astronomy that requires you to look through a telescope, but after graduating you became permanently blind. You may be able to show and convince a bankruptcy judge that this constitutes “undue hardship.”

If you’re filing for bankruptcy protection, and you’re interested in exploring whether you qualify for a student loan bankruptcy discharge, you should seek out professional bankruptcy counsel. In Mankato, MN and the surrounding communities, Behm Law Group, Ltd. should be your first point of contact when considering your bankruptcy options. We have highly trained bankruptcy attorneys with extensive experience when it comes to making sense of the Bankruptcy Code and how it applies to our clients’ unique situations.

Let us guide you through the bankruptcy process. We know how bankruptcy law works and how it can work for you. Contact Behm Law Group, Ltd. today to discuss your bankruptcy options.