Behm Law Group, Bankruptcy Attorneys

Across Minnesota, K-12 school budgets are dropping, and funding for private colleges is also suffering in several departments. This trend has had a marked effect on students, teachers, and administrators alike. For teachers and professors, the effect can be immediate or gradual. Specifically, those employed as educators at all levels have experienced an overall reduction in salaries, meaning their finances have changed for the worse. This shift has been a large part of why we’ve seen increased cases of educators filing for Chapter 13 bankruptcy in Fairmont, MN, and across the state. If you are an educator struggling to meet debt payments, Behm Law Group Ltd. can provide the guidance and assistance you need to file a successful case and find long-term debt relief.

Chapter 13 Bankruptcy for Educators

If you have made the decision to file for bankruptcy as an employed educator, you are most likely restricted to filing for Chapter 13 bankruptcy. While lowered salaries may be what brought you to the point of filing for bankruptcy, the fact remains that you still have an income. This means you won’t qualify for Chapter 7 liquidation bankruptcy unless your debts significantly outweigh your income.

On the bright side, Chapter 13 bankruptcy is often more desirable for those who want to keep their home and other possessions. Instead of liquidating your non-exempt assets in exchange for debt discharge like Chapter 7, Chapter 13 works to reorganize your debts into a reasonable monthly payment that you make to a chapter 13 trustee.

The reorganization process structures your debts into a repayment plan that lasts three to five years, depending on your income. If your income is lower than the median Minnesota income for a household of your size, your plan will last only three years. If your income is higher than the state median income for a household of your size, your plan is must last five years. In our experience, educator incomes do not typically exceed the median, even when filing jointly with their spouses. This means you can typically expect to have a three year repayment plan and pay a lower percentage of many types of debt.

How Chapter 13 Handles Debt

A Chapter 13 reorganization plan handles debt in several ways. First, you generally will continue to make your monthly payments to most of your secured debts, such as mortgage loans and vehicle loans, directly to those creditors.  Sometimes, however, if you have become delinquent with your mortgage payments or vehicle payments, any pre-petition or pre-bankruptcy filing delinquencies can be paid or “cured” through your chapter 13 plan.  For instance, if you have become $5,000.00 delinquent with your mortgage payments, this amount can be paid to the creditor by the chapter 13 trustee through your chapter 13 plan over the duration (36 to 60 months) of your plan.  You must, however, be able to make the ongoing, regular post-petition mortgage payments that come due after your case has been filed.  Second, priority debts such as certain tax debts, alimony and child support arrearages or even criminal fines, must be paid in full. Third, general unsecured creditors, such as credit card debts, medical debts, etc., do not receive interest, late charges or service fees.  Any amounts that are paid to those creditors go against the principal that you owed those creditors when your bankruptcy case was filed.  Typically, unsecured creditors are only paid a percentage of the total you owed them when your case was filed.

When the debt amounts are calculated and structured into your plan, you’ll be able to see the amount required to be paid monthly to your bankruptcy trustee. You can rest assured this amount will fit your income, though keep in mind your discretionary income will depend on a budget relating to your reasonable and necessary living expenses and your disposable income (income over and above what is necessary to cover your monthly reasonable and necessary living expenses) must be paid to unsecured creditors through your plan. This monthly payment may change if your monthly income and monthly reasonable and necessary living expenses change.

To learn more about filing for Chapter 13 bankruptcy in Fairmont, MN, as an educator, contact Behm Law Group Ltd. at (507) 387-7200 today.

For the majority of creators and others working in the arts, finding a source of steady income is often a difficult part of the vocation. From visual and performance artists to authors and musicians, work is hard to come by, and these jobs are highly competitive.

Because of this hardship, it’s understandable that there are several cases of bankruptcy a year filed by creatives. Even famous artists are not safe from financial struggles, as told by the 2009 circumstances of famed photographer, Annie Leibovitz. If you’re struggling to make ends meet as a creative, Behm Law Group, Ltd. provides guidance and support to help you file a successful case for Chapter 7 bankruptcy in Redwood Falls, MN.

For the most part, artists filing for bankruptcy don’t have a steady income to qualify for Chapter 13 reorganization. Because of this, Chapter 7 liquidation is the most common type of bankruptcy for those relying on their art, writing, performance, or other creative abilities for income. Chapter 7 bankruptcy provides a valuable debt discharge process overseen by a bankruptcy trustee, with fair treatment of both the filer and the creditors.

Assets in Chapter 7 Bankruptcy

For the most part, Chapter 7 bankruptcy is the same process for creatives as it is for those making a living from more typical vocations. The trustee sells off non-exempt property and distributes the sale proceeds to the creditors involved.  In most Chapter 7 bankruptcy cases, however, filers are able exempt and they retain all of their property; typically, the only things they lose are their creditors.  Priority debts such as child support debt and tax debt have to be listed in the Chapter 7 bankruptcy proceeding but, for certain public policy reasons, those types of debt are more difficult to get discharged.

For artists, there may be some differences in the Chapter 7 asset liquidation process. Specifically, any income you make from your work is counted as an asset. If you’re a painter, for example, unsold paintings created at any point before you file for bankruptcy are considered business inventory that must be disclosed. Typically, there is a “tools of the trade” and a “wildcard” exemption with which such business inventory and brushes, canvasses and other “tools” used to produce the paintings can be protected.

As a writer, if you have intellectual property rights to a book or a play you’ve written, any income from the sales of that book or from the royalties of your work will be included in the bankruptcy process. If you can’t exempt all of that intellectual property, you may lose some of the rights to it and to some of the future income it may provide.  Your creditors may benefit from the non-exempt values or portions of those rights and future income.   This is commonly seen with musicians filing for bankruptcy. The intellectual property will go to the purchaser of that asset (to a record label, for example).

In a nutshell, if your art, craft, or other creation is providing you with income but you still need to file for Chapter 7 bankruptcy, those creations can be included in and are relevant to the Chapter 7 process.

To learn more about filing for Chapter 7 bankruptcy in Redwood Falls, MN, as an artist, author, musician, or other creative, contact Behm Law Group, Ltd. at (507) 387-7200 today.

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.

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.

Around this time of year, we all take a look at our past 12 months of finances. Filing taxes forces us to recount our incomes, debts, and overall monetary matters. On top of all our typical credit card debts, medical bills, car loans, and other debts, we can all be susceptible to tax debts.

If you’re struggling to pay tax debts in addition to meeting your other debt obligations, it might be time to look at debt relief options. When the point comes where your debts are severely affecting your quality of life, it’s important to take positive action to find balance for your finances. With the help of Behm Law Group, Ltd., you can gain the many advantages that debt relief through filing for bankruptcy in Worthington, MN provides.

Filing for bankruptcy can help you resolve many types of debt in two ways: discharge or reorganization. If you file for Chapter 7 bankruptcy, the majority of your debts will be discharged and you can claim exemption amounts to protect your property from liquidation. With a steadier income, you can choose to file for Chapter 13 bankruptcy and have your debts reorganized into a repayment plan limited to three to five years, and some of your debts will be discharged at 0-100%.

While many debts are discharged and reorganized in the process of bankruptcy, there are some priority debts that are exempt from all types of bankruptcy cases. For many, this includes tax debts. Some tax debts can be discharged in Chapter 7 bankruptcy or included in a repayment plan under Chapter 13.

Though some tax debts are not discharged through the bankruptcy process, there are other tax debts that can be treated in bankruptcy, including income tax debts secured by the government. Put simply, secured tax debts are debts that the IRS has placed a lien on your property to protect their right to repayment. This typically occurs when a debt has been left unpaid for an extended period or when the government foresees your inability to pay a tax debt.

Liens on tax debts turn into levies when collection action is taken. You can prevent collection action by filing for bankruptcy and getting an automatic stay placed on all creditor action – including the IRS. Additionally, you may be able to completely dissolve the lien and the debt in your bankruptcy case. In fact, most secured tax debts that qualify for the bankruptcy process can be resolved with the best outcome for you.

Understanding the difference between priority and non-priority tax debts is important for all bankruptcy cases that involve tax debts in any capacity. If you suspect or know for sure your tax debt is considered a secured debt by the IRS, contact Behm Law Group, Ltd. at (507) 387-7200 to learn more about its treatment in bankruptcy. If you’re ready to start filing for bankruptcy in Worthington, MN today, the advice and assistance of Behm attorneys is important to building a successful case.

March is the time when determination for New Year’s resolutions start to waver. If you’ve made your New Year’s resolution based on your budget, that wavering can significantly damage your financial well-being. Those who have filed for Chapter 13 bankruptcy in the past know they don’t have any other option than to adhere to the budget outlined in their repayment plan. If you’re struggling with your budget, filing for Chapter 13 might mean long-term debt relief and better spending practices. With the help of Behm Law Group Ltd., you can file for Chapter 13 bankruptcy in Mankato, MN, and structure a repayment plan that will set you up for success.

Chapter 13 reorganizes your debts into a three- to five-year repayment plan. This is a great option for those with a steady income who want to receive court-approved debt relief with a structured budget for the repayment plan period. With a Chapter 13 bankruptcy, filers will have to repay their priority debts, like amounts owed for taxes, criminal fines, child support and alimony, in full, but most can receive a debt reduction up to 100% on unsecured debts.  Even secured debts, like vehicle loans and mortgage delinquencies, can be paid under different and more favorable terms.

After you file, you have the opportunity to restructure your debts into a plan proposal. The plan lasts three or five years depending on your income. When the court approves your plan, you will make monthly payments to a chapter 13 bankruptcy trustee.

Although the concept of a Chapter 13 repayment plan is highly attractive, some might find it difficult to adhere to that plan, especially if a wavering budget sent them into bankruptcy in the first place. Sticking to your repayment plan means you have to take some things into consideration:

1. Your plan is structured around your income, so any income changes (a new job, for example) must be reported immediately to your bankruptcy trustee or your plan may be dismissed for lack of good faith.
2. Because your plan is structured around your income, it also takes in the fact that you have monthly expenses for food, travel, utilities, rent, and more. The money you will have to spend to live each month is accounted for in your plan.
3. While your necessary spending is taken into account in your repayment plan, your unnecessary spending is not. All of your disposable income (any money left over after reasonable and necessary monthly expenses) will have to be paid to the chapter 13 trustee for your unsecured creditors involved in your repayment plan.  You and your lawyer can work with the chapter 13 trustee on your budget to determine your reasonable and necessary expenses.  While the chapter 13 trustee is a fiduciary for your creditors, the trustee is not intransigent or inflexible in this process.
4. Sudden income sources like tax refunds, bonuses and commissions may or may not have to be paid to the chapter 13 trustee and into your repayment plan. This is something that can be negotiated at the time it occurs.

It is completely possible to live month to month during a Chapter 13 repayment period. In fact, the entire goal of reorganization bankruptcy is to allow filers to live their lives as normally as possible while they repay debt. If you are considering filing for Chapter 13 bankruptcy in Mankato, MN, and are concerned about sticking to a tight budget, contact Behm Law Group Ltd. at (507) 387-7200 for more information today.

Running a small business is one of the most difficult ways to make a living, no matter where you’re located. Startups close down even before they gain momentum, family-owned businesses go under, partnerships collapse, and countless businesses of all kinds file for bankruptcy as a result of a wide range of factors.

Anyone who owns a business knows these difficulties for themselves, and many business owners view the last gasp of failure as a bankruptcy filing. The fact is, however, that bankruptcy may be a viable solution to keeping your business running successfully in the long-term. Behm Law Group, Ltd. offers legal counsel and protection for businesses filing bankruptcy in Windom, MN, and we can guide you through the process of saving your business for the long run.

The type of bankruptcy that most business owners think of when they view it as a “failure” resulting in closing up shop is Chapter 7 liquidation bankruptcy. While it’s true that the majority of Chapter 7 business bankruptcies will end with a closed down business, there are exceptions and other types of bankruptcy that can support debt relief without forcing a shutdown.

Chapter 13 vs. Chapter 7

If you want to keep your business in operation with a goal of long-term debt relief, then filing for Chapter 13 or Chapter 11 bankruptcy is most likely the best option. Both of these types of bankruptcy work to reorganize your debts into a repayment plan that fits your business budget. Businesses that are not sole proprietorships (LLCs, partnerships, or corporations) are generally not appropriately addressed in Chapter 13 but for those businesses Chapter 11 has its own advantages. For sole proprietorships, Chapter 13 bankruptcy is a better option than Chapter 11 because you can include both your business debts and personal debts in the repayment plan. Additionally, in a Chapter 13 repayment plan you have the option to protect your business property with exemptions, reduce overall debt amounts for unsecured nonpriority debts, and structure your debts overall into a court-approved repayment plan.

Even though most Chapter 7 business bankruptcies result in a closing of that operation, there are times when that shutdown doesn’t occur in a liquidation bankruptcy. Specifically, sole proprietorship businesses can continue to operate their business after a Chapter 7 filing, and like with a Chapter 13 plan, filers can include their personal and business debts in the liquidation process. The types of businesses that continue to operate most successfully after a Chapter 7 liquidation are those with few assets. For example, personal trainers, therapists, consultants, freelancers, and other similar service providers can continue to operate successfully in the face of asset liquidation.

If you’re a business owner struggling to repay debts, filing for bankruptcy can help you continue to operate your business and gain long-term debt relief. To learn more about filing bankruptcy in Windom, MN as a business owner or individual, contact Behm Law Group, Ltd. at (507) 387-7200 today.

If you own a business and are struggling to meet payments on anything ranging from rent to utilities, you may benefit from taking advantage of the government-regulated system of bankruptcy. While it might seem like a big step to take, bankruptcy is designed to help businesses of all sizes into a full financial recovery. In fact, if you file for a Chapter 13 bankruptcy, your debts will be restructured into a manageable repayment plan for your business.

Not only is it possible to protect your business and the property involved when you choose to file for Chapter 13 bankruptcy, you may be able to continue expanding your business during the bankruptcy period. With the help of our attorneys at Behm Law Group, Ltd., you can keep your business afloat while you file for bankruptcy in St. Peter, MN.

 Filing for Chapter 13 Bankruptcy

Chapter 13 bankruptcy works to restructure your debts as a whole into a new repayment plan spanning a period of three to five years. Within this repayment plan your secured debts and priority debts must be repaid in full, but your unsecured debts will be restructured into the plan with only partial repayment required ranging from 0% to 100%.

Chapter 13 is a debt reorganization process available to both consumers and businesses, and while Chapter 11 is a similar reorganization process businesses can utilize, it is designed for very large businesses and is often impractical for individual consumers.  There are often greater benefits and more opportunities for full, long-lasting recovery when you choose Chapter 13 over 11.

One reason your business may thrive even through a repayment plan in Chapter 13 bankruptcy is because it’s possible to gain business credit, allowing for overall growth in your company.

Business Credit

Because even the most efficient businesses still incur debts through normal operations, especially when all disposable income in a Chapter 13 bankruptcy plan is used to repay unsecured creditors, you’re allowed to gain ordinary credit without needing approval from your trustee or authorization from the court. For example, if you own a bakery and need to buy a large inventory order of sugar and flour, you don’t need court approval to do so if you can pay for that shipment within 30-60 days.

However, if you gain credit outside the terms of ordinary business operations, you’ll need to receive court approval before making a purchase that’ll put your business in debt. In the example of the bakery, you’ll need court approval if you have to purchase a large appliance or vehicle necessary for normal business operations. To prove you can repay that item without it affecting your repayment plan, you have to:

1. File a motion to authorize the purchase
2. Explain to your trustee, creditors, and the court why that item is needed
3. Demonstrate you can afford the item and still make payments on your plan

Gaining business credit during your repayment plan is an option that Chapter 13 bankruptcy often provides within reason and choosing this form of reorganization bankruptcy can allow your business to grow even through difficult times. To learn more about filing for a business bankruptcy in St. Peter, MN, contact Behm Law Group, Ltd. at (507) 387-7200 today.

With medical insurance getting more expensive each year and procedures becoming more technically-advanced with new equipment and medicines, individuals can easily accumulate overwhelming medical debt very quickly. While studies may debate whether severe medical debt is directly causing an increase in U.S. bankruptcies, the fact remains that it’s often a correlating problem most filers experience. Because the bankruptcy process is structured to discharge or reorganize medical debts, it’s a viable option for those who can’t pay their medical bills. With the help of Behm Law Group, Ltd., you can recover from medical debt and successfully file for bankruptcy in Worthington, MN.

Medical debt can happen gradually as chronic treatments rack up bills or all at once if an unexpected medical emergency occurs. No matter the circumstances leading up to unmanageable medical debt, those debts are treated the same in bankruptcy cases. All your medical bills are considered to be unsecured nonpriority debts in your case. To put this in perspective, your credit card debts are categorized as unsecured nonpriority debts as well.

How your unsecured nonpriority debts are handled depends on the type of bankruptcy you file for.

Chapter 13 works to reorganize debts that aren’t exempt from the bankruptcy process into a new repayment plan. Secured debts are repaid in full along with select priority debts, but your unsecured debts—like the medical bills you owe—are often only partially repaid if they’re required to be repaid at all.

Chapter 7 works to liquidate your assets to repay your creditors in return for the discharge of most debts. This discharge includes your unsecured debts and allows immediate full relief from medical bills.

Limitations on Discharges

Relief from medical bills is guaranteed if you qualify for Chapter 7 bankruptcy by passing the Means Test. All your unsecured debts will be dissolved in return for major liquidation of your assets. In Chapter 13 bankruptcy, there are some limitations on the relief you can receive for your medical bills. Because your medical debt is lumped into one category with all your other unsecured nonpriority debts, they’re all subject to the same limitation. This limit manifests as a cap on the amount you can include in your repayment plan. Currently, you may file for Chapter 13 if you have under $394,725 in unsecured debts. This amount will change in April of 2019 to meet standards of income and overall economic adjustments, but for now, you can resolve all your debts in a new repayment plan if you meet this and other Chapter 13 requirements.

 There may be some limits to the possibility of recovering from severe medical debt by filing for bankruptcy, but the majority of cases are highly effective in providing a solution for those struggling with hospital bills and more. For more information about filing for bankruptcy in Worthington, MN, contact Behm Law Group, Ltd. at (507) 387-7200 today.

When you file for Chapter 13 bankruptcy, your debts will be restructured into a three to five-year repayment plan that fits your income and financial situation. For those with incomes too high to pass the Means Test or who wish to hold on to most of their nonexempt properties, Chapter 13 is a highly effective way to resolve debts and get a fresh financial start. Organizing your documents, files, forms, and information into a structured repayment plan proposal that the court will accept is a difficult task to manage without the help of a trained bankruptcy professional. Behm Law Group, Ltd. offers the legal support and assistance you need to file a strong case for Chapter 13 bankruptcy in Luverne, MN.

After you propose a Chapter 13 repayment plan that’s accepted by the court, the bankruptcy trustee administering your case will collect monthly payments that may vary based on the disposable income information you provide. The amount you’ll be required to repay in your plan depends on your creditors and your disposable income. For example, you must fully repay your priority unsecured creditors, such as certain tax debts, child support debts, alimony and court fines, while your unsecured creditors only need to be paid much less as determined by several factors. Changes may be made to your plan depending on other claims, income, and financial gains or losses. To prevent your case from being dismissed within your three to five-year repayment period, continued communication with your attorney and the bankruptcy trustee is key.

You may also find yourself facing unforeseen circumstances that make it impossible for you to complete your Chapter 13 repayment plan.

If you find yourself in these circumstances, you may be eligible for the Hardship Discharge. This discharge works similarly to a discharge granted in a Chapter 7 bankruptcy case.  You will no longer have to make a plan payment.  Like in a Chapter 7 case, certain debts, including unsecured debts like medical bills, credit card debts, and more, are discharged. However, priority debts like tax debts, child support debts and alimony are not subject to the Hardship Discharge.

Eligibility: To be eligible for the Hardship Discharge, you have to prove your conditions render you unable to continue with your repayment plan. If you’ve failed to meet repayment requirements for more than a month due to burdens that are out of your control (“for which you should not justly be held accountable”), you have the chance to make your case for a hardship discharge. You improve your chances of the court granting you a Hardship Discharge if you can prove your circumstances are permanent (physical disability, for example) and if you’ve already repaid to your unsecured creditors what they would have received if you’d filed for Chapter 7.

For more information about the Hardship Discharge and filing for Chapter 13 bankruptcy in Luverne, MN, contact Behm Law Group, Ltd. at