Thirteen Facts about Chapter 13 (Part Two) in the Mankato Minnesota Area

Welcome back scholars in the Mankato Minnesota area! Today, we’ll be completing our study guide of thirteen facts about Chapter 13 bankruptcy.

Before we get started, let’s have a brief moment to review. Chapter 13 bankruptcy is often called a “wage earner’s plan” because debtors are offered the opportunity to repay debts. This gives them approximately 3-5 years to repay creditors and, during that time, they must typically be employed.

So, now, let’s learn a little bit more about Chapter 13:

1. Q: Other than the creditor and debtor, who else is involved in filing for Chapter 13 bankruptcy?
A: Typically, a neutral trustee must be involved in the filing.

2. Q: Are co-debtors protected under Chapter 13?
A: Yes, co-debtors are protected. Creditors are restricted from collecting “consumer debt” from anyone liable on a debt with the individual debtor. A creditor can get relief from the bankruptcy court to pursue a co-debtor if good cause warrants such relief.

3. Q: What is “consumer debt,” exactly?
A: The term “consumer debt” refers to individual debts acquired for personal, familial, or household reasons.

4. Q: What are the types of claims related to Chapter 13 bankruptcy?
A: There are three types of claims involved:
• Priority claims: These claims have a special status within bankruptcy law, and they include claims regarding taxes and filing costs.
• Secured claims: Creditors who have these claims have collateral securing the debts that they can take from a debtor if the debtor does not make payments.
• Unsecured claims: Creditors who have these claims do not have collateral securing the claims that they can take if a debtor does not make payments.

5. Q: What happens if a debtor is unable to pay?
A: Their Chapter 13 filing may be converted to a Chapter 7 filing instead or it may be dismissed.

6. Q: Can a debtor be discharged from Chapter 13 after repaying debts?
A: Yes, but only if the debtor has completed all payments required under the debtor’s chapter 13 plan, if the debtor has not received a chapter 13 discharge within 2 years before the present case was started, and if the debtor has taken a course in financial management.

Well, this concludes our two-week course in Chapter 13 bankruptcy! If you live in the Mankato Minnesota area and believe all this studying has prepared you for your own filing, contact the professionals at Behm Law Group Ltd. today.

Successful Business after Bankruptcy in the Mankato Minnesota Area

Donald Trump’s history with bankruptcy has been all over the news lately. It may seem odd that a high-profile name associated with wealth, apprentices, and successful business could also be associated with bankruptcy. Unfortunately, Donald Trump’s financial struggles are not uncommon and serve as proof that bankruptcy can happen to anyone.

If you’re living comfortably in the Mankato, Minnesota area, this may be an unsettling thought. There’s no need to fret, though, because many important, successful business folk have experienced bankruptcy and thrived as a result of it. Behm Law Group, Ltd. has compiled a short list of names you’ll likely recognize:

  • Walt Disney – Thanks to an untrustworthy distributor, Disney’s first, Kansas City-based company went under in 1923. Just five years later, though, Disney worked his magic with a new creation: Mickey Mouse. His new company in Hollywood, California quickly bounced back from bankruptcy.
  • Henry Ford – Ford proved to be his own downfall in 1901. He held his vehicles to such a high standard of perfection that, in one year, the company only made and distributed 20 cars. Only two years later, however, Ford took a new approach towards The Ford Motor Company and made it a post-bankruptcy success. 
  • Milton Hershey – The Hershey company hasn’t always been a sweet success. Milton Hershey filed for bankruptcy after his businesses in Philadelphia and New York both failed, which then brought him home to Lancaster, Pennsylvania. It was here, after his bankruptcy filing, that Hershey struck gold in the form of milk-based caramels and secret recipe chocolate bars.

These famously successful business moguls prove that, no matter the circumstance, bankruptcy can happen to anyone. For each of them, though, success didn’t arrive until after they’d let go of past debts. If you like how that sounds, live in the Mankato, Minnesota area, and feel prepared to begin filing, contact Behm Law Group, Ltd. today.

 

Seven Facts about Chapter 7 Bankruptcy in the Mankato Minnesota Area

School is about to start up in the Mankato, MN area, which means that students everywhere are looking ahead to homework and assignments. By the end of the month, they’ll be memorizing biology flashcards, solving algebra equations, and working through textbook chapters.

However, students aren’t the only ones working through chapters. At Behm Law Group, Ltd., our bankruptcy professionals are always ready to handle Chapter 7, a specific type of bankruptcy with a unique set of rules and restrictions.

If Chapter 7 is something you’d like to learn more about, take a peek at our notes. Behm Law Group, Ltd. has compiled a study guide of seven facts to know about Chapter 7 bankruptcy:

1. Q: How long does it take to file for Chapter 7 bankruptcy?
A: Typically, it takes about 3-4 months to file and obtain relief from debt.

2. Q: How long does a filing remain on my credit report?
A: A bankruptcy filing can remain for about five to seven years.

3. Q: What might I lose when filing for Chapter 7 bankruptcy?
A: It depends on each individual case but most possessions will be exempt and the exemption laws allowing you to keep property are quite generous.

4. Q: Will Chapter 7 take care of alimony or student loan debt?
A: If a debt is truly alimony, probably not but sometimes alimony is not really alimony and the right to receive it has been assigned to some other entity. In such a case, sometimes relief can be accorded. With respect to student loans, a person must go beyond the filing of a bankruptcy petition by filing an adversary proceeding against the student loan lender. Sometimes, student loans can be discharged if one can establish “undue hardship” but the process is very expensive and protracted.

5. Q: Am I able to file for bankruptcy a second time?
A: Yes! However, there are certain time restrictions involved.

6. Q: What kinds of time restrictions?
A: In most scenarios, you must wait at least six years between Chapter 7 bankruptcy filings.

7. Q: Do I still need to repay certain debts despite a Chapter 7 filing?
A: Sometimes. Certain types of debts, like some tax debts, child support or alimony obligations, aren’t generally discharged in a Chapter 7 proceeding.

Feel prepared for an exam on Chapter 7 bankruptcy? If you live in the Mankato, MN area, put down your number two pencils, throw away those test booklets, and give Behm Law Group, Ltd. a call today.

Thirteen Facts about Chapter Thirteen in the Mankato, MN Area | Part 1

Class is still in session in the Mankato, Minnesota area! Please take your seats, sharpen your pencils, and prepare for your second week of Bankruptcy 101. Last week was all about Chapter 7 which means that, today, we’re going to focus on another type of bankruptcy: Chapter 13.

We at Behm Law Group, Ltd. have prepared another overview to help you decide which type of bankruptcy is best for you. So, without further ado, here’s part one of our Chapter 13 study guide:

  1. Q: What exactly is Chapter 13 bankruptcy?

A: Chapter 13 is a type of bankruptcy that allows debtors to gradually repay some (but not all in most cases) of their debts. This is why it’s often called a “wage earner’s plan.”

 

  1. Q: In order to file, do debtors need to have a consistent income?

A: Yes. This is because payments to a chapter 13 trustee are made in regular installments over a period of time.

 

  1. Q: How long does a debtor have to repay these debts?

A: A chapter 13 bankruptcy must last at least 3 years.  Sometimes, however, it can go for 5 years.  The maximum time a chapter 13 bankruptcy case last is 5 years.

 

  1. Q: Do debtors have to confront their creditors through out the process of filing?

A: No. Debtors don’t need to have any direct contact with their creditors.

 

  1. Will Chapter 13 bankruptcy erase all outstanding debts and payments?

A: Debtors are still responsible for paying certain expenses, such as mortgages, but are able to halt foreclosure and allow extra time for other payments such as payments on tax debts and mortgage delinquencies.

 

  1. Q: Who can file for Chapter 13 bankruptcy?

A: Individuals are eligible for this type of filing, but generally corporations and partnerships do not file for chapter 13 bankruptcy protection.

 

  1. Q: Which documents are required for a Chapter 13 filing?

A: At a minimum, four documents are required: a creditor list, the debtor’s documented income, the debtor’s documented property, and the debtor’s documented living expenses.

If you live in the Mankato area and believe Chapter 13 is the right kind of bankruptcy filing for you, contact the professionals at Behm Law Group, Ltd. today. Class dismissed!

Taking Control of Time and Bankruptcy in the Mankato and Southeast Minnesota Area

For people living in the Mankato and southern Minnesota area, summertime gets to be a little hectic. Schedules are jam-packed with everything from county fairs to work events, Little League practices to Fourth of July celebrations. Busy schedules make it very easy to lose track of time.

When it comes to filing for bankruptcy, however, timing is important. There’s not a generally accepted “best time” of year for people to file for bankruptcy, so it can be difficult to decide which time is personally best for your finances. This summer, however, Behm Law Group, Ltd has developed a four-step process to make your decision a little easier:

1. First, ask yourself a few important questions:

Do bill collectors contact you regularly?

Do you feel afraid to address your finances or to consider bankruptcy?

Do you know how much money you owe?

Do you pay only the minimum on your credit cards?

2. If you answered “yes” to the above questions, it may be time to seriously address your financial situation regarding bankruptcy. This can be a scary realization, so it may be beneficial to recruit some help. After assessing your situation, contact a professional credit counselor or financial advisor. This professional can serve as a support system for both you and your finances!

3. Next, begin collecting all of your bills and expenses, adding together retirement funds, stocks, bonds, and any of your other liquid assets. Though this may be time consuming, it’s worthwhile. Having a calculated total of your assets will give you a much clearer understanding of your financial situation when considering bankruptcy.

4. Finally, compare your total assets to your total debt. If you find that your assets are still worth more than your debt, you may be a candidate for loan modification, refinancing, or creditor negotiation. If you realize that your assets are worth less than your overall debt, it’s likely the right time to file for bankruptcy.

Here in the Mankato and southern Minnesota area, summer goes by way too quickly. Rather than wasting time feeling worried about your finances or putting off tough decisions regarding bankruptcy, take control of your time. Contact Behm Law Group, Ltd today.

Deciphering the Language of Bankruptcy in the Mankato Minnesota Area

If you’re living in the Mankato, MN area, it’s likely you’ve heard plenty of jokes about Minnesotan dialects and language. There are all sorts of local idioms around these parts, from “Duck, Duck, Gray Duck” to “hot dish,” each of which belong proudly situated within the culture of Minnesota.

When it comes to the culture surrounding bankruptcy, it’s no surprise that it has a language all its own. There are all sorts of words that sound unfamiliar, even in a basic definition of what “bankruptcy” means:

“A federally authorized procedure by which a debtor—an individual, corporation, or municipality— is relieved of total liability for its debts by making court-approved arrangements for their partial repayment.”

…What?!

Including a few words from that definition, Behm Law Group, Ltd. has a list of key terms that will help you translate the language of bankruptcy:

  1. Liabilities are monetary or legal obligations.
  2. Debts are monetary or legal obligations that are owed.
  3. Debtors can be people, partnerships, corporations, or municipalities. The debtor is the subject within a bankruptcy case, meaning they owe money or have legal obligations towards another person or organization.
  4. Creditors are people or organizations that debtors owe. Typically, they are owed either money or another legal entity.
  5. Assets are all forms of property held by the debtor.
  6. Liquidated debts are for a specific, numerical amount. While debtors are still responsible for non-liquidated debts, their exact monetary amount is not known.

With this list of terms in your dictionary, it should be just a little easier for you to decipher the complex vocabulary within a bankruptcy filing.

Whether you speak the language of bankruptcy fluently, or you’re still a little confused, the professionals at Behm Law Group, Ltd. can help. For a clear, simple translation of bankruptcy in the Mankato, Minnesota area, contact Behm Law Group, Ltd. today.

Managing Financial Fitness After Bankruptcy in the Mankato and Southeast Minnesota Area

If you’re living in the Mankato and the southern Minnesota area, this is your summer to get fit with Behm Law Group, Ltd. At Behm Law Group, Ltd, “fit” doesn’t mean low-fat smoothies, long outdoor runs, or a perfect beach body. Here, “fit” means managing personal financial fitness in order to make the best decisions regarding bankruptcy. Although you may think your finances are in shape, we’ve devised a workout plan to manage your monetary health this summer.

1. Learn the facts: Bankruptcy can happen to anyone. Did you know that over four million families filed for bankruptcy between 2008 and 2010 within the United States alone? Or that many people don’t file for bankruptcy when they should? Knowing the facts about bankruptcy is the first step to improving your overall financial health.

2. Manage your credit: Maximize your credit score by paying bills on time and tracking credit card balances. It can be easy to lose track of payments or bills, especially during summer vacations or holidays. Continued missed payments can lead to both debt and bankruptcy. Be sure to create a schedule in order to follow bill schedules, exceed minimum payments, and avoid accruing debt.

3. Boost your nest egg: Even if money’s tight, try to invest a small amount of each paycheck into a future nest egg. Anyone, whether excessively wealthy or living between paychecks, is susceptible to bankruptcy if they experience a sudden accident, financial crisis, job loss, or serious illness. It’s healthiest to prepare before disaster strikes.

The attorneys at Behm Law Group, Ltd can help get your finances back in shape. When filing for bankruptcy is the healthiest option for your finances, Behm Law Group, Ltd can answer questions, offer advice, or create a monetary workout that best suits your needs. If you live in the Mankato or southern Minnesota area, and you are ready to get financially fit, contact Behm Law Group, Ltd today.

What Bankruptcy Means for Your Credit Now and in the Future | Mankato, MN

According to a survey conducted by YouGov, far more adults (62%) are worried about the effect bankruptcy would have on their credit reports than the shameful stigma attached to declaring bankruptcy (26%). If you are considering bankruptcy in the Mankato, MN area, Behm Law Group wants to help you understand what declaring bankruptcy means for your credit profile.

How does bankruptcy affect my credit score?

Your credit score is an easy way for you and creditors to calculate the health of your credit profile. Declaring bankruptcy means that you are in a situation where you are unable to make payments on your debt, so it is viewed as a very negative event on your credit report. But the overall impact it has depends on your entire credit profile. If you had perfect credit, you would probably see a large drop in your credit score. However, since most people who declare bankruptcy usually have poor credit and several other negative marks on their credit reports, bankruptcy might make a relatively small dent in a credit score.
Additionally, bankruptcy stays on your credit report for up to 10 years after you file and will continue to affect your credit score until it is removed. Even so, that doesn’t mean you are unable to obtain new credit in the meantime.

How soon can I qualify for new credit?

Bankruptcy is a means of clearing your financial slate and it will take time for you to rebuild your credit history to the point where creditors are willing to grant you a line of credit. Generally it takes 18-24 months of full, on-time payments before you will be able to qualify for most loans. Of course, creditors also take into account your income, debts and assets so you may be a viable candidate for new credit sooner if your financial situation has greatly improved since you declared bankruptcy.

Here are some general timelines for a few of the major types of credit:
• Credit Cards: This type of credit is usually available immediately after a bankruptcy because credit card companies can justify charging you higher interest rates and fees if you have a checkered credit history. Be wary of opening new credit cards, however, as you might easily find yourself deep in debt again. A secured card is a safer way to begin rebuilding your credit because it can be used like a regular credit card but it requires a deposit upfront to cover your credit limit.

• Auto Loan: Auto loans are also often readily available soon after filing bankruptcy thought the interest rates will be quite steep. If possible, you might want to wait until you can qualify for a loan with a more competitive interest rate to avoid paying more in interest over the life of the loan.

• Mortgage: While some lenders will give you a home loan right after filing for bankruptcy, it is best to wait at least two years before applying for a mortgage. Not only will you have time to develop a good credit history, lenders will usually leave your bankruptcy out of the consideration and offer you better interest rates. Plus you will also be able to save for a down payment and decrease the amount you need to take out in loans.

Though bankruptcy may cause your credit to take a hit immediately after filing, declaring bankruptcy can actually help you in the long-term by wiping out most, if not all, of your debt. This allows you to start managing your money better and rebuilding your credit without the burden of monthly payments. If you are ready to start over financially, call Behm Law Group for assistance with declaring bankruptcy in the Mankato, MN area.

Limit Spousal Input Before Starting a Business or Declaring Bankruptcy for Your Mankato, MN Area Business

When starting a new business, you need to carefully consider many decisions such as where to locate, what type of services to offer, how much equity each owner gets, and what pricing and business models to use. But did you ever think you should be concerned about your partner’s spouse? The bankruptcy attorneys at Behm Law Group, Ltd. believe such a consideration should be duly noted in the Mankato, MN area.

 

You might think this doesn’t matter because you are going into business with your partner, not their spouse. But consider these questions before you sign on the dotted line and commit your capital to the business venture.

  • What if the spouse has undue influence over your partner’s decision-making abilities?
  • Does the spouse have any experience in or knowledge about running a business?
  • What if the spouse is designated as a successor in the business should your partner suffer an untimely demise?
  • Is spouse difficult to work with when in a position of power?
  • Does the spouse share your and your partner’s vision for your business?

 

Of course, you want to trust that your business partner will be able to keep their professional and personal relationships separate for the good of your business. But you could find yourself in an uncomfortable situation if you don’t take some precautions in your business agreement:

 

1) Make sure all business owners in your venture sign a business agreement which addresses all aspects and possibilities for your business. Leave nothing to chance.

 

2) Define the spouse’s role in your business. How much influence, if any, a spouse would have? Can he or she make decisions? Can a spouse become an owner? If an owner, what are the terms for selling the spouse’s share?

 

3) Address the potential need for bankruptcy. At what point should the discussion of bankruptcy be brought up? Who makes the final decision to declare bankruptcy?

 

Whether you’re contemplating a business agreement or have already filed for bankruptcy, seek our counsel at Behm Law Group, Ltd. We specialize in bankruptcy in the Mankato, Minnesota area and can offer you sound advice for making the best decision regarding bankruptcy for your business before it’s too late.

Small Business Owners in Mankato, MN – Should you file chapter 13 or chapter 7 bankruptcy?

If you’re a small business owner and you’re considering filing for bankruptcy, it’s important that you have information on which type of bankruptcy you should file for. Filing fort bankrupcy it is definitely not an ideal situation, but sometimes it’s necessary. Having the right information will help you to make the right decision so that you can begin to improve your financial situation in the most effective way possible. If you’re a small business owner in Mankato, MN, then chapter 7 bankruptcy will more than likely be the right option for you. In some cases, however, chapter 13 bankruptcy may be a more viable option.

 Let’s take a look at your options to find out which one you should choose:

 Reasons to choose chapter 7 bankruptcy:

  • It will be settled much faster – Chapter 7 bankruptcy cases usually conclude in a matter of months whereas chapter 13 bankruptcy cases can take three to five years.
  • It will be easier to start a new business – You can’t file bankruptcy for your business with chapter 13 bankruptcy. It would be much easier to close your current business down under chapter 7 than to try to keep it afloat while also having to deal with chapter 13 personal bankruptcy. You can deal with your debts and start a new and improved debt free business.
  • You aren’t required to pay your unsecured debt – In chapter 13 bankruptcy you will be required to pay at least some of your unsecured debt in most cases. You aren’t obligated to do that under chapter 7 bankruptcy.

When chapter 13 bankruptcy may be the right option:

  • You have an asset rich business – If you’re a small business owner and you don’t want your business to be shut down because it has a high amount of valuable assets that you want to keep, you should not file for chapter 7 bankruptcy. You may even want to try and settle your debts on your own and avoid filing altogether.
  • You want long term protection – If you want more time to catch up on certain payments like your mortgage or car payment under the protection of bankruptcy law, then chapter 13 bankruptcy is a better option.
  • You have a unique asset that you want to keep – If you have a certain asset that is not protected under chapter 7 bankruptcy but is protected under chapter 13 bankruptcy, then choose the latter.

Hopefully this information can help you make the right choice. If you’re a small business owner and are considering filing for bankruptcy or just want more information, contact the professionals at Behm Law Group Ltd in Mankato, MN. We’re here to guide you and help you build a better financial future.