Understanding Your Role According to the Bankruptcy Code in Worthington, MN if Your Landlord Goes Bankrupt

If an individual or business seeks debt relief in the form of bankruptcy, creditors, employees, tenants, and others around them are affected. If a landlord files for bankruptcy, for example, their tenants will be involved in the filing process to a certain extent. If you are a landlord struggling with debt, Behm Law Group, Ltd. offers counsel in filing for bankruptcy. On the other side of that coin, Behm Law Group, Ltd. also offers advice for tenants with a bankrupt landlord, providing important information regarding their role according to the bankruptcy code in Worthington, MN.

Landlords filing for bankruptcy will either file Chapter 7, Chapter 11, or Chapter 13 bankruptcy. For those that qualify for the asset liquidation process in return for debt discharge, Chapter 7 is the most common option. Both Chapter 11 and Chapter 13 offer a debt reorganization bankruptcy structure. Chapter 11 is designed to reorganize the debts of landlords that are not sole-proprietorships or partnerships (e.g. apartment complexes with multiple locations owned by a corporation). Chapter 13 bankruptcy, on the other hand, provides debt reorganization to many landlords who have a sole proprietorship or a partnership operation.

 

What to Expect as a Tenant

If your landlord files for bankruptcy, they have to inform all their tenants. When any bankruptcy case is opened, the court puts an automatic stay on collections from creditors, but it doesn’t mean you can stop paying rent. However, it does mean that if the property your landlord rents out is in foreclosure, that process is halted and your landlord retains ownership of the property. Because of this, you should continue to pay your landlord until you are notified by the bankruptcy trustee or the mortgage creditor itself that ownership of the property has changed. This change can occur in several ways:

 

  1. Your landlord’s mortgage lender can file a motion with the bankruptcy court to lift the automatic stay for that debt. If the motion is successful, the trustee or the mortgage lender itself will let you know who to pay rent to.
  2. If the case ends and your landlord’s property is liquidated, the ownership may change to the party that has purchased the property. If this occurs, the trustee will provide the information you need about your new landlord.
  3. If no one purchases the property, you will make payments to the trustee in the meantime.

 

If your landlord retains the property in their case, you will continue to make payments to them. If they do not retain it and another buyer plans to use the property for other purposes, you may be forced to move. You will be given fair warning and 90 days, or some other mutually agreeable time period, to find a new living situation.

 

The bankruptcy code can be difficult to navigate for all involved. In most cases, a bankrupt landlord will not affect tenants drastically, but it’s important to be aware of their financial status and the bankruptcy code in Worthington, MN. To learn more about filing for bankruptcy as a landlord, contact Behm Law Group, Ltd. at (507) 387-7200 today.

Escrow Accounts and Chapter 13 Bankruptcy in Owatonna, MN

Anyone with a mortgage or other large loan either has an escrow account or knows about the function of one. Escrow accounts are set up with a third-party agent or broker who manages and distributes the money in that account. The account works as a consolidation system for a mortgagor, holding values required to make a single payment for the monthly loan, interest, taxes, and insurance. Escrow amounts will change over time based on the cost of property taxes, insurance rates, and other taxes. If you have an escrow account and you find yourself in a situation where you must file for Chapter 13 bankruptcy in Owatonna, MN, Behm Law Group Ltd. can help you understand how it will affect the account and guide you through the process of filing bankruptcy overall.

 

Chapter 13 bankruptcy works to reorganize your debts into a three- to five-year repayment plan. The reorganization plan is an extremely valuable option for those with a steady income who don’t want to work through the asset liquidation process of a Chapter 7. A repayment plan typically takes priority, secured, and unsecured debts, and rolls them into a single monthly payment made to a bankruptcy trustee.

 

While large portions of your unsecured debts are discharged in a chapter 13 repayment plan, your priority debts, such as tax debts, child support debts and alimony, and secured debts on assets that you want to retain, such as vehicles and houses, must be repaid. Because your mortgage is a secured debt, it must be paid in full but typically you will continue making the regular monthly mortgage payments directly to the mortgage lender rather than through the chapter 13 trustee. In many cases, the debt leading up to a bankruptcy and a Chapter 13 plan itself can affect mortgage escrow in two ways:

 

  1. Pre-petition arrearage: If you have been unable to meet full escrow payments even before you file for bankruptcy, you will have an escrow shortage, and therefore, be in arrears. In this case, the court will treat the shortage like a typical mortgage arrearage and require it to be repaid in full throughout the repayment period. Unlike a mortgage, however, the shortage amount does not incur interest.
  2. Post-petition arrearage: When you enter a repayment plan, you have to meet escrow payments as a part of the consolidated monthly payment that’s due. If you can’t meet this payment and you become short on escrow, you may be in danger of a case dismissal if you do not take steps to propose and work through a repayment plan adjustment.

 

The three to five years you are working through a Chapter 13 plan require you to be conscious of your finances and to maintain a strict adherence to your budget. The financial struggles that put you into the position of filing for Chapter 13 bankruptcy must be put behind you, and the court expects you to understand the responsibilities of a repayment plan.

 

That said, there will be room for adjustments to be made throughout the repayment period depending on your income and your costs of living. If you are considering filing for Chapter 13 bankruptcy in Owatonna, MN, contact Behm Law Group Ltd. at (507) 387-7200 today.

 

When Filing for Bankruptcy in Mankato, MN Is Your Best Option

If you are facing financial difficulties, you are not alone. Individuals in all types of circumstances can find themselves deep in debt because of numerous factors. In fact, the chance of severe debt is not an impossibility for anyone, and you should not feel shame for having financial troubles or for considering bankruptcy as an option for debt relief. If you are wondering whether you should file for bankruptcy in Mankato, MN, Behm Law Group Ltd. can help you answer any questions that you might have as well as counsel you throughout your case.

 

Bankruptcy is an excellent option for finding your way out of serious debt. It can resolve your debts in a liquidation process through Chapter 7 bankruptcy or in a reorganization process through Chapter 13 bankruptcy.

 

Although bankruptcy is a highly effective solution for many debtors, it is not always the best solution for certain financial circumstances.

 

 

How to Know When to File

To determine whether filing for bankruptcy is the best option for your financial circumstances, you need to ask yourself some questions:

  1. Are you unable to meet debt payments or are you meeting them with a severe detriment to your necessary living expenses?
  2. Are most of your debts treatable in the bankruptcy process? (There are some types of debts that are not subject to discharge.)
  3. Are you able to pay the bankruptcy fees and an attorney fee?
  4. If you plan to file for Chapter 7 bankruptcy, will you satisfy the Means Test?
  5. If you plan to file for Chapter 13 bankruptcy, are you prepared to be responsible for a repayment plan for up to five years?
  6. Do your debts fall into the accepted limitations for bankruptcy? (For example, debt limits in chapter 13 cases.)
  7. If you plan to file for Chapter 7 bankruptcy, will you be able to protect the properties you want to keep with the allotted exemptions?
  8. Are you prepared to attend credit counseling and meet other pre-bankruptcy requirements?
  9. Are you able to organize, with the help of a Behm attorney, all the necessary documents of your finances and property for the bankruptcy petition?
  10. Do you understand and accept the effect that bankruptcy will have on your credit?
  11. Do you accept the fact that a  your bankruptcy filing could be known by the general public?
  12. Do you have a long-term rehabilitation plan for your finances after you file for bankruptcy, and are you willing to work with a Behm attorney to assist you in that regard?

 

If you can answer all of these questions and still believe that you could benefit from bankruptcy, then it’s likely that filing will provide a valuable opportunity for debt recovery. To learn more about filing for bankruptcy in Mankato, MN, contact Behm Law Group Ltd. at (507) 387-7200 today.

 

 

Long-Term Financial Effects of a Government Shutdown and Getting Help from a Bankruptcy Attorney in Marshall, MN

Starting in December of 2018 and ending more than a month later, the recent government shutdown was the longest in U.S. history and impacted more government employees across the country than any other shutdown before. The ripple effects of the shutdown grew by the day and had severe effects on many employees’ finances. The lack of income for government departments, programs, organizations, and employees alike caused, for many, a rapid decline into debt.

 

If you were affected financially by the recent government shutdown and are facing unmanageable debts because of this, filing for bankruptcy is a viable option to receive government-sanctioned debt relief. Behm Law Group, Ltd. can help you file a strong case with the guidance and counsel of an expert bankruptcy attorney in Marshall, MN.

 

Reports of shutdown-related debts and expenses have come from all kinds of sources. All types of government employees suffered financially from the shutdown. A month without a paycheck can lead quickly to all kinds of poor financial conditions simply due to an inability to pay bills. Government employees found that they were unable to make payments on a wide range of common bills or debts including:

 

  • medical bills and health insurance
  • utilities, including water, electricity, and gas
  • rent or mortgage
  • car payments or car repairs
  • automotive and related insurance
  • life insurance
  • retirement plans
  • student loans
  • credit cards
  • taxes

 

Businesses and organizations that relied on government funding also suffered badly, and the individuals employed by these businesses and organizations experienced a range of difficulties such as not receiving a paycheck and benefits or being laid off. Though the shutdown only lasted for a month, the long-term effects will last for years. Recovery from unexpected, sudden, and complete cutoff from an income and government support for an unknown amount of time is still causing a real struggle today for many U.S. citizens and businesses.

 

In comparison with the 2013 government shutdown, for example, the recovery process has proved to be more difficult and longer simply due to the suddenness, time frame, and nature of the 2018-2019 shutdown. The lack of structure and planning in this recent shutdown created an outcome resembling an economic recession that was crammed into a 30-day period.

 

In times like these, it’s important to remember that consulting a bankruptcy attorney is a real option that you should consider seriously. If you were unable to pay your bills because of the government shutdown and are still trying to overcome the negative effects, bankruptcy may provide realistic, long-term recovery from debt.

 

To learn more about filing for bankruptcy and how an expert bankruptcy attorney in Marshall, MN, can help you get back on your feet after the shutdown, contact Behm Law Group, Ltd. at (507) 387-7200 today.

Understanding a Potential Congressional Reform of Chapter 12 Bankruptcy in Luverne, MN

Across the Midwest, family-owned farms are still struggling to make ends meet after a difficult start to the growing season. Farmers and fishers in the region are facing large debts without an income to match the required monthly payments. Because of these financial difficulties, more and more families are filing for bankruptcy or seeking other forms of debt relief. If you’re a family farmer or fisher and have been unable to make payments on your debts, bankruptcy might be the right path to take. With the help of Behm Law Group Ltd., you can file a successful case for Chapter 12 bankruptcy in Luverne, MN, and find your way out of debt without sacrificing your family business.

In the 1980s, the U.S. government devised a bankruptcy chapter specifically suited to treat the debts of family farmers and fishers. This chapter was based on the bankruptcy laws set up for fishers and farmers in debt during the Great Depression. Today, Chapter 12 works to reorganize debts into a repayment plan tailored to debtors’ income and expenses. This process is similar to Chapter 13, but it’s specific to the debts and expenses of family farmers and fishers.

 

For many purposes, current Chapter 12 laws have worked well to protect family farms and fishing operations while ensuring fairness to their creditors. However, in the face of current farm debts, Congress has introduced a potential reformation of Chapter 12 bankruptcy.

 

Why the change?

Farm debts have been around since farms have existed, but farms themselves have changed even since the 1980s when Chapter 12 standards used today were established. The average size of family farms and fishing operations have increased dramatically in the past 40 years, and the debt amounts have increased accordingly. However, the amount of debt allowed to file for Chapter 12 bankruptcy instead of liquidation bankruptcy has not increased alongside farm sizes and debt amounts. To continue protecting farms from liquidation, some aspects of Chapter 12 need to change.

 

What might change?

Primarily, Congress is proposing increased debt limits for those looking to file for Chapter 12. Family farmers and fishers are currently allowed up to $4.153 million in debt to qualify for Chapter 12, but average debts today are more than double that. Increased costs for property, equipment, supplies, facilities, and fuel all lend themselves to higher debts for farms with lower income overall. To allow more farms to reform with the structure of a Chapter 12 repayment plan, the debt limits need to be raised.

 

With several members of Congress supporting plans for Chapter 12 reform, more family farmers and fishers may be given a chance to repay debts and stay in business for the long term. If you think filing for Chapter 12 bankruptcy in Luverne, MN, or the surrounding area might be the right choice for your farm, contact Behm Law Group Ltd. at (507) 387-7200 today.

Exemptions for Chapter 7 Bankruptcy in Pipestone, MN

If you are unable to meet your monthly debt payments and don’t know how to get yourself out of your current financial situation, bankruptcy might be a valuable option for government-addressed debt relief. Filing for bankruptcy is a process that’s frequently given a negative image, primarily because of the impact it has on your credit score, but in fact, bankruptcy often has a positive long-term effect on your financial standing. Petitioning for bankruptcy and working through the filing process may seem daunting, and it is a nuanced legal procedure. However, with the help of a professional bankruptcy attorney, you can put together a strong, successful case for Chapter 7 bankruptcy in Pipestone, MN.

 

Chapter 7 bankruptcy is one of the most common bankruptcy chapters individuals and businesses file for in the United States. The process of Chapter 7 bankruptcy works to liquidate your non-exempt assets (properties) in exchange for discharging (dissolving) your debts. If your income is lower than the amount you are required to pay for your current monthly debts and your reasonable and necessary living expenses, you qualify for Chapter 7.

 

While Chapter 7 seems like a last gasp for many, largely because of the liquidation process, it’s not a process designed to leave you destitute. While some of your assets could be sold or liquidated, that is the exception rather than the rule.  Most people who  file for bankruptcy relief can and do protect and keep their properties with their allowed bankruptcy exemptions.

 

Exemptions are a key part of the filing process for Chapter 7 bankruptcy. The U.S. Bankruptcy Code provides exemption allowances for many of your properties, from your home and car to your small personal property items. The current Minnesota exemptions include:

 

  1. Homestead: Up to $420,000 for most homes (non-agricultural use) or $1,050,000 if the home is used primarily for agricultural purposes.
  2. Insurance: Including accident, disability, and life insurance for a spouse and dependent beneficiaries as well as fire and police beneficiaries.
  3. Trade Tools: Including agricultural equipment, livestock, and crop stores up to $13,000 in value; teaching materials and other tools of trade up to $12,000.
  4. Wages: 75% of your earned, unpaid wages within the past six months; wages earned within six months of release from prison; and wages paid within six months of employment after welfare.
  5. Personal Property: Including appliances, furniture, radios, and TVs up to $10,800; burial plots, church pews, clothing and watches, food, utensils.
  6. Public Benefits: Including compensation for crime victims, unemployment, and workers’ as well as veterans’ benefits.
  7. Miscellaneous: The wages of your child under 18, ERISA-qualified benefits and IRAs under $72,000, and property of partnership businesses.
  8. Vehicle. Value in a motor vehicle of up to $4,800.00.

 

The preceding list denotes just some of the many exemptions you can claim in a Chapter 7 case. First and foremost, bankruptcy is designed to be fair to you and your creditors alike. The court does not want you to be left with nothing, and so exemptions allow you to protect your property during a Chapter 7 liquidation.

 

To learn more about filing for Chapter 7 bankruptcy in Pipestone, MN, contact Behm Law Group Ltd. at (507) 387-7200 today.

Resolving Sudden Financial Crises with the Right Bankruptcy Attorney in Waseca, MN

The economy we live in allows for rapid financial shifts for individuals and businesses alike. While these changes can be positive, there is often a greater chance that you or your business will face negative outcomes as a result. For those who own and operate a retail business in the U.S., the reality of how quickly their financial status can change is recognized across industries. If you’re facing a recent change to your finances and have had hardship in meeting debt payments, it might be time to tackle these issues. With the help of Behm Law Group, Ltd. you can find debt relief through bankruptcy with the guidance of an expert bankruptcy attorney in Waseca, MN.

 

For businesses and individuals alike, bankruptcy is frequently painted in a negative light, but the truth is that both reorganization and liquidation bankruptcies are viable and highly effective long-term processes if applied to the right situation with the help of a bankruptcy attorney.

 

One example of a situation in which two separate types of bankruptcy first failed to fix and then successfully remedied a business in debt are the recent cases of the Scheherazade Jewelers in Edina, MN.

 

The Scheherazade Jewelers were an upscale shop specializing in high-end jewelry ranging from the $500-$50,000 range. The company was well-established in the Galleria mall, and up until recently was located in a prime spot that allowed for exposure to major mall traffic. However, after the store moved to a lesser trafficked location in the mall, revenue started to decline.

 

In 2010, the store filed for Chapter 11 bankruptcy and had their debts reorganized into a repayment plan suited to their then-current income. This chapter works similarly to Chapter 13 bankruptcy, a common bankruptcy process that is limited to individuals, spouses, sole proprietorship businesses, and partnership businesses. The benefits provided to Scheherazade Jewelers through Chapter 11 proved to be less effective than desired, and the business continued to lose profits.

 

In March of 2019, the store filed for Chapter 7 liquidation bankruptcy. For both individuals and businesses, Chapter 7 bankruptcy can be a gradual or a sudden necessity. The process liquidates assets in exchange for debt discharge. Essentially, while Chapter 11 only provided a short-term attempt at long-term debt resolution, Scheherazade Jewelers could not stay afloat in the current economy. Instead, Chapter 7 provided a valuable way for the owners to cut losses and gain a fresh financial start.

 

For the creditors of Scheherazade Jewelers, this Chapter 7 bankruptcy may have been a sudden blow, but the financial patterns displayed over the past 9 years reveal a long buildup to liquidation. If you’re struggling with your debts, you can decide whether you want to resolve them now or have a long buildup to a bankruptcy that seems sudden.

 

Contact Behm Law Group, Ltd. at (507) 387-7200 today for more information about filing and how an expert bankruptcy attorney in Waseca, MN can help you build a successful case for long-term relief.

 

Guidelines and Limitations of Chapter 13 Bankruptcy in Windom, MN

Chapter 13 bankruptcy is a format of debt reorganization most common for individuals and some types of businesses. Overseen and administered by a standing bankruptcy trustee, a Chapter 13 case takes secured, unsecured, and priority debts and alters them into a consolidated repayment plan that lasts three to five years depending on the debt amount of the filer. If you have a steady income and want to protect your assets from the liquidation that could occur in a Chapter 7 case, Chapter 13 may be the best choice for you. With the guidance of Behm Law Group, Ltd., you can successfully file for Chapter 13 bankruptcy in Windom, MN and obtain long-term debt relief.

 

While Chapter 13 is a highly effective bankruptcy option for people in a broad range of financial situations, it has limitations and guidelines like any other type of legal process. The most basic of these limitations decides who can and can’t file.

 

Who can file?

  1. Individuals:
    1. For an individual to qualify for Chapter 13 bankruptcy, they must have a steady income that allows for reasonable and necessary expenses for living to be factored out of their repayment plan while still meeting monthly payments.
    2. They must have undergone credit counseling within 180 days prior to filing.
    3. They cannot have secured debts exceeding $1,184,200 or unsecured debts exceeding $394,725.
    4. They must have filed all of their income tax returns for the past four years prior to filing.
    5. They cannot have filed a Chapter 13 case within the past two years or a Chapter 7 case within the past four years.
    6. They cannot have filed and had dismissed another bankruptcy case within the last 180 days.
  2. Spouses:
    1. Spouses can file a joint Chapter 13 case involving both of their debts and combined incomes if they have also met all the requirements listed for individual filers.
  3. Businesses:
    1. Some businesses are eligible to file for Chapter 13 bankruptcy. Specifically, those whose owners are personally liable for the business debts.
    2. This includes sole proprietorships and business partnerships.

 

Other limitations and guidelines of Chapter 13 bankruptcy outline the repayment plan itself.

What is an accepted repayment plan?

  1. For a filer’s repayment plan proposal to be accepted by their trustee and the court, it must meet specific requirements designed in fairness to creditors.
  2. In their repayment plan, a filer must be able to repay allowed secured creditors’, under adjusted loan terms/conditions, in full over a three to five-year period.
  3. Their priority debts such as tax debts, child support debts, alimony, criminal fines, etc., must be included in the plan and must be repaid in full over a three to five-year period.
  4. Unsecured debts must be repaid the value of the filer’s non-exempt assets that would have otherwise been liquidated in a Chapter 7 process.   This is informally referred to as the “Best Interests Test”.  For example, if a filer would have non-exempt assets totaling $10,000.00 in a hypothetical Chapter 7 case, the filer must pay that amount over a three to five-year period to their creditors in a Chapter 13 case.

 

While there are many guidelines to follow and limitations to adhere to in the process of Chapter 13 bankruptcy in Windom, MN, it’s undeniable that it has been an effective treatment for a wide variety of debtors. To learn more about the process or to get started, contact Behm Law Group, Ltd. at (507) 387-7200 today.

 

Rising Debt in the Growing Season Increases Cases of Chapter 12 Bankruptcy in Mankato, MN

Ever since people have learned to grow plants and care for livestock, farming has proved to be one of the most difficult occupations in which to make money. Because farming is so dependent on natural conditions, it’s inevitable that it is often filled with hardship. In today’s global economy, and in the face of changing environmental factors, farming has become a harder way to make a living than ever before. If you are struggling to support your farm, you are not alone. With the help of Behm Law Group Ltd., you can decide whether filing for Chapter 12 bankruptcy in Mankato, MN, is the right choice for you, and work through the process with our guidance and support.

 

Chapter 12 bankruptcy is specifically designed to treat the financial conditions of a family farmer. Like Chapter 13 and Chapter 11, this process reorganizes your debts into a manageable repayment plan overseen by a bankruptcy trustee. This allows you to keep your company and property stabilized until your debts are repaid under adjusted or modified loan terms. If you have a difficult few years, Chapter 12 can be a critical option for keeping your family farm running.

 

The problem many farmers have struggled with in the last twenty years is a lack of demand. Farmers can grow more corn and soybeans than ever before thanks to GMOs and pesticide technology. While crop demand increased with production until recently, it has now started to drop in comparison with the supply ratio. Due to this, farmers are seeing decreasing income in response to the time, hard work, and cost of crop production.

 

Reflecting the difficult times farmers are currently facing across the country, Minnesota has seen a rapid increase in the number of Chapter 12 cases, especially during the spring growing season. Spring is the time of year when income from the previous season is most important to be able to get a new crop in the ground and established for the coming months. If you have struggled to make ends meet in the previous year and have seen a decrease in demand for your supply, you may be facing an even lower return in this new season.

 

This cycle starts to resemble a spiraling out of income and a loading on of debt for farmers. A demand for crops that cannot match the supply grown causes a lower income for farmers. This lower income prevents them from paying necessary costs-of-living and farming expenses, and results in more debt, more loans taken out, and in the long term, a higher risk of bankruptcy.

 

Despite this negative cycle we are currently seeing for Minnesota farmers, the possibilities that Chapter 12 bankruptcy offers are a silver lining that, not only allows farmers to keep their businesses running and resolve debt, but also provides a long-term solution for unbalanced supply and demand. To learn more about how filing for Chapter 12 bankruptcy in Mankato, MN, can help farmers with unmanageable debt, contact Behm Law Group Ltd. at (507) 387-7200 today.

 

Preventing Foreclosure and Keeping Your Home with Chapter 13 Bankruptcy in St. Peter, MN

Filing for bankruptcy can be a long-term solution for many financial problems, from credit card debt to car loans. Bankruptcy can also prevent and resolve the issue of a looming foreclosure. If you are struggling to meet debt payments each month, including those on your mortgage, bankruptcy might be the right choice for your household. With the help of Behm Law Group Ltd., you can file a successful case resulting in an effective repayment plan through Chapter 13 bankruptcy in St. Peter, MN. Not only will this repayment plan stop foreclosure, it will also provide a foundational solution for the rest of your debts that can be treated in the bankruptcy process.

 

If your home goes into foreclosure, it can be at least seven years before a lender will consider you for another property loan. However, it can take just two to four years after a bankruptcy before you can take out another mortgage on a home or business. Filing for bankruptcy is also a better option to keep your home and find additional resolutions for your other debts.

 

Automatic Stay

As soon as you file for bankruptcy, the court will automatically place a stay on your creditors’ right to collect any debts from you. This means you will be given relief from any mortgage foreclosure actions as well as collection actions for your other debts until the outcome of your case is resolved. If you file for Chapter 13 bankruptcy, the ideal outcome of your case will be a comprehensive three- to five-year repayment plan that is suited to your income and your reasonable and necessary living expenses.

 

Property Protection

In a Chapter 13 bankruptcy repayment plan, you won’t have to go through the same process you would in a Chapter 7 plan. This means your property will be protected from liquidation sales, but it also means you will still be responsible for paying debts on property, such as your house or vehicle, that you may want to keep.  Post-petition (after the bankruptcy filing) payments on any debts that are secured by such physical property, must continue to be paid throughout the duration of a Chapter 13 plan. If you want to keep your home, you must pay the ongoing, post-petition regular mortgage payments.  Any delinquency that you may have on the mortgage before your case is filed will be paid by the chapter 13 trustee through your chapter 13 payment plan.  However, you would still be required to make the regular mortgage payments that come due after the filing of your case and you would continue to make those payments directly to the mortgage creditor.

 

The benefit of filing for bankruptcy in this scenario is that your payment plan is structured, monitored, and enforced by the court and the bankruptcy trustee. Your Chapter 13 repayment plan is highly mutable based on your current income situation. For example, if your income drops beyond a point where you can meet your payments for a three-year plan, the court can alter your repayment plan into a five-year structure with lower monthly payments instead of the original proposal.

 

To learn more about filing for Chapter 13 bankruptcy in St. Peter, MN, and other bankruptcy options, contact Behm Law Group Ltd. today at (507) 387-7200.