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Minnesota Bankruptcy Advice- Are Student Loans Eligible for Discharge?

Tips from Minnesota Bankruptcy Attorneys- Behm Law Group

Student loans are generally understood to be “exempt” when it comes to bankruptcy protection. If you have student loans, you are required to pay them back in full, and the federal government has put rules into place to ensure that debt is collected. There are provisions that can help ease student loan debt, but the burden of proof is on you to prove you are in a position that makes it practically impossible for your to pay your loan. Filing for bankruptcy in Minnesota is a viable option. The Minnesota bankruptcy attorneys at Behm Law Group offer advice on how to navigate these tricky waters.

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Student loan debt is a huge concern nationwide. As college tuition continues to skyrocket, hundreds of thousands of graduates and perhaps their parents are saddled with debilitating student loan debt that can equal or exceed the price of most starter home mortgages. Private and federal student loan debt exceeded credit card debt in 2010, hit the $1 trillion mark in 2011, and as of this year stands at $1.2 trillion dollars. Meanwhile the economy is struggling to regain past employment levels and starting wages are generally lower, leaving college graduates with burdensome debt and little opportunity to get back on track.

Up until 1976 all education loans could be discharged through bankruptcy. That year the bankruptcy code was changed which disallowed college or government loans to be discharged during the first five years of repayment. After five years of payment the loans could be discharged though bankruptcy or if “undue hardship” was being experienced by the borrower. In 2005 Congress passed the Bankruptcy Abuse Prevention and Consumer Protection Act which gave further protections to student loans, both federal and private, from bankruptcy protection.  The only “door” left open for bankruptcy protection was if the borrower could demonstrate to the court that repayment of the student loan would cause an “undue hardship.”

Undue hardship can be exceptionally difficult to prove. Just the simple fact that you don’t have the funds available to pay your loan generally does not qualify as undue hardship.

Navigating through this complicated legal landscape is something best left to a professional bankruptcy attorney. Though full bankruptcy protection is still far from an attainable goal regarding most student loan debt, legal avenues do exist for at least a partial discharge of the overall debilitating debt burden that’s all too common for today’s college graduates.

Behm Law Group, Ltd. employs a professional team of bankruptcy attorneys who can help you through the daunting legal world of bankruptcy protection. With our years of dedicated training in the field of bankruptcy we can advise you about your student loan debt options and whether or not you meet the demanding criteria for having your student loans discharged through bankruptcy.

Serving Mankato, MN, and surrounding areas, Behm Law Group, Ltd. is available to help clients maneuver their way through financial difficulty and avoid the stress and uncertainty of unnecessary, burdensome debt. Contact Behm Law Group, Ltd. to discuss your bankruptcy options.

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They Are Not on Your Side- Credit Cards Can Lead to Bankruptcy

Considering bankruptcy in Minnesota? Behm Law can help.

Commercials for big credit card companies make it look and sound like their only intent is provide you with an easy alternative to cash or checks to help all your “wants and needs” come true. The commercials show happy people buying bag-loads of goods at high-end stores, retiring to a beach-front home, or treating friends to an expensive dinner at a pricey restaurant. But are they really on your side? Are they really there to help you make your dreams come true? A look at their net incomes give you a glimpse of what they’re really out to do, and who truly benefits from their services.
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One recognizable company, Capital One, which gets half of its income from credit cards, reported a $1.1 billion net income for third quarter, 2013. Think about that—$1.1 billion in one quarter. The biggest credit-card issuer, American Express, reported a $1.37 billion net income for third quarter, 2013. Wells Fargo, the largest U.S. home lender, reported a third quarter net income of $5.58 billion. One thing is certain; these companies can’t achieve net incomes in the billions of dollars each quarter by giving money away. They make their exorbitant profits by charging high interest rate
s, massive late fees, and ridiculous overdraft fees. In other words, they lure you with friendly promises of luxury and convenience, and then snag you with highly predatory interest rates and insurmountable fees and penalties.

Credit card companies love to advertise “easy, affordable” credit. But, when times get tough and you’re financially struggling, they can make resolving your financial hardships unbearable and hopelessly unaffordable. Have you been entrapped by the large credit card companies? Is your income being sapped by high-interest payments? Are you over your head in debt? If so, do everything you can to get out of their snare. Your financial future depends on it. But if you are in so much financial trouble you cannot escape on your own, bankruptcy might be your only option. To see if bankruptcy is the right solution for you, call the personal bankruptcy attorneys at Behm Law Group Ltd. Unlike the big credit card companies, we really are there for you.

 

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The Government Shutdown and Bankruptcy

How does the government shutdown affect Minnesota Bankruptcy?

minnesota bankruptcy behm law groupUnless you’ve been on an extended vacation in a far-away land with limited access to television, radio, or internet, you have heard about the U.S. government shutdown. The media calls it a “partial shutdown.” You may be wondering, “How does the government shut down relate to Minnesota bankruptcy?” Well, for the countless people who are affected by the government shutdown, there’s nothing partial about it; many are left completely without wages and pay. Not only are government employees affected, but also government contractors. Furthermore, there will be a financial domino effect. Companies that do business with the government won’t get paid. In addition, the restaurants, coffee shops, and retails stores that cater to government employees will see a reduction of business, and could end-up laying off employees, or worse, even be forced to shut their doors for good. And, when the unemployment benefits and savings accounts for these people dry up, many will have no option but to file for bankruptcy.

All of these victims of the government shutdown who end up filing for bankruptcy will have to do so not because they are careless, shopaholics, or addicted to gambling, but because of something over which they have no control: the decisions of a handful of powerful legislators. At Behm Law Group Ltd, we understand that this is true not just for furloughed government workers, but for most people who file for bankruptcy. Their financial problems were caused by forces and events over which they had no control, such as a CEO’s bad business decisions, skyrocketing medical costs, or the lagging economy.

At Behm Law Group Ltd, you will find understanding bankruptcy attorneys who will handle your case with compassion and professionalism. We know it’s not your fault. All we want is to help end your personal financial crisis. If your finances are being ruined by forces out of your control and you’re not sure what to do, call Behm Law Group. We can help you.

 

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Why Chapter 13 Bankruptcy? Advice from Behm Law Group

Mankato Bankruptcy Tips

Chapter 13 Bankruptcy, Behm Law Group, Mankato BankruptcyFor some people, Chapter 13 bankruptcy is the best option to consider when deciding which type of bankruptcy to file. While Chapter 7 bankruptcy discharges people from all of their unsecured debts, Chapter 13 allows you to renegotiate your debts into more affordable payments which you make over the next three to five years. Chapter 13 isn’t for everybody, but it just might be the right option for you. The experienced bankruptcy attorneys at Behm Law Group can help you decide which option is right for you.

Ineligible for Chapter 7

Not everyone is eligible for Chapter 7 bankruptcy. To be eligible, you have to pass the means test, which we have discussed in a previous post . However, Chapter 13 bankruptcy offers you some protection that Chapter 7 does not.

Protect Your Property

If you want to retain your property, such as a house or a car, you will want to file for Chapter 13. While Chapter 7 bankruptcy only discharges debt, Chapter 13 can allow you to reorganize your debt on secured property under much more favorable terms. Also, Chapter 13 allows you to protect property that you might not be able to keep in a Chapter 7 bankruptcy.

Protect Your Conscience

Even though they are in a bad situation through no fault of their own, some people feel guilty about filing for bankruptcy. They want to feel like they have kept their obligations. For these people, Chapter 13 provides the opportunity to reorganize their debt  into more manageable payments and may afford them greater peace of mind. 

We’re Here to Help

The bankruptcy attorneys at Behm Law Group, Ltd. are dedicated to helping people make these difficult decisions. We can help you decide whether Chapter 7 or Chapter 13 is best for you. If you need help deciding between Chapter 7 or Chapter 13, give us a call.

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Chapter 7 Bankruptcy and The Means Test

Chapter 7 Bankruptcy Mankato MNThe means test was developed to ensure that the only people who file for Chapter 7 bankruptcy are those who truly do not have the ability to pay back their debts. There are many factors that go into the means test, so you should rely on an experienced Minnesota bankruptcy attorney to help you determine if you qualify for Chapter 7 bankruptcy.

The first factor the means test uses to qualify you for Chapter 7 is your income. Basically, if your income is less than the median income in Minnesota for the size of your household, and your debt is consumer debt and not business debt, you qualify for Chapter 7. There is no further test required. However, even if your income is above the median income for Minnesota, you may still qualify for Chapter 7.

Another factor the means test considers is your disposable income. Your disposable income is what is left over after you have paid for your allowed monthly expenses. If the money that is left over after expenses is not sufficient to make payments on your debts, you may qualify for Chapter 7, even if you income is above the median. Otherwise, you must file for Chapter 13, which means you will have to make one monthly payment each month to a chapter 13 trustee for a certain period of time (36 to 60 months) which gets split up among your creditors each month pursuant to the terms of a chapter 13 plan of reorganization. However, that is not necessarily bad news. Depending on your situation, Chapter 13 might be your best option.

The bankruptcy attorneys at Behm Law Group Ltd. deal exclusively in the area of bankruptcy law. Our highly trained and experienced staff can help you decide if Chapter 7 or Chapter 13 is best for your situation. When you are ready to put your debts behind you and move on with your life, give us a call.

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Going to Jail for Owing Money? Or, Bankruptcy?

There are not supposed to be debtor’s prisons in the United States. That’s what bankruptcy is for. However, debt collectors have found a legal dirty trick to send a debtor to jail. Though it doesn’t happen often, this is a technique they are using that you should know about, especially if you have succumbed to the allure of payday loans. This dirty trick is called a “body attachment.”

Body Attachment Defined

A body attachment, also called a “writ of bodily attachment,” is a type of court order that is usually used for people who are guilty of contempt of court. It is a lot like an arrest warrant. The rules for how a body attachment can be used depend on local laws. As an example, if someone is in contempt of court for missing a court date, a court can order a writ of bodily attachment. Once this order is issued, the court can authorize a sheriff to physically force a person to show up in court. Unfortunately, debt collectors have found a way to use body attachments to harass debtors.

Body Attachment Abused

A debt collector cannot threaten to throw a person in jail. However, debt collectors have been able to use body attachments to do just that. For example, they might get a judgment against a debtor. The collector can then summon the debtor to court. However, the debt collector will then summon the debtor to many, frequent hearings, or worse, they might even fail to notify the debtor of the hearing. As a result, the debtor misses their appointment, and the court issues a body attachment. The debtor then ends up in jail and often pays much more than he or she owes in bail money. If they don’t pay the bail money, they must sit in jail until the court date.

A Bankruptcy Filing Ends the Abuse

When you file for bankruptcy, debt collectors can no longer directly contact you. They must always go to your Minnesota bankruptcy attorney. In other words, when you hire a bankruptcy lawyer, you have an advocate to stand up for your rights. If you’re being harassed and abused by debt collectors, call the bankruptcy attorneys at Behm Law Group, Ltd. We’ll end their unwarranted abuse and work diligently to protect your legal rights.

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Is Bankruptcy the Easy Way Out?

Has anyone made you feel that by filing for bankruptcy you are taking the easy way out? That judgmental attitude is not only incorrect, it can be harmful if it keeps you from getting the help you need. Bankruptcy is not a trivial thing. It can be a complex process that requires the skill of an experienced bankruptcy attorney. On top of that, bankruptcy can have serious consequences if it is not done right. For many people, however, it is the only choice they have.

Repercussions
Bankruptcy can have serious effects on your credit score. If you file for either Chapter 7 or Chapter 13, the bankruptcy may stay on your credit report for 5 to 7 years. You may need to disclose that you filed for bankruptcy when you apply for credit. Not only that, but can it turn up if you rent a house or apartment, get a cell phone, or apply for car insurance. With these possibilities, it is inaccurate to characterize bankruptcy as being an easy way out.

The Only Way Out
Through no fault of their own, people find themselves in bad financial situations. A job loss or sickness – they find themselves choosing between food and debt payments. They realize they will never pay off all their debts. For these people, bankruptcy is the only way out.

Get the Help You Need
At Behm Law Group, we understand that no one wants to file for bankruptcy. We’ll never make you feel like you’re taking the easy way out. We’ll treat you with the respect you deserve. Stephen Behm has the extensive experience, knowledge, and skill to guide you through the bankruptcy process with as little disruption to your life as possible. Contact us today to obtain the best results when you need to file a chapter 7, 12, or 13 bankruptcy.

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Experience and Sensitivity Needed

When you hire a bankruptcy attorney, you are putting your financial future into that person’s hands. Not only that, but you will be required to show that person all of your finances. If you’re like many people, your finances are deeply personal and sometimes embarrassing. For those reasons, you want to make sure that you pick an attorney with both the experience and sensitivity to help and treat you with understanding.

Experience
If your attorney does not manage your case properly, you can lose your rights and property. Because bankruptcy can be a nuanced, detail-oriented and complex proceeding, you need to hire an attorney with the experience to handle your case the right way. At Behm Law Group, we limit our practice to bankruptcy law. That means that we can handle your bankruptcy case, no matter how complex.

Sensitivity
Have you heard the old adage, never lie to your lawyer? When you file for bankruptcy, you will have to show your attorney all of your finances: every debt, savings and checking accounts, stock accounts, and more. You will have to show your bankruptcy lawyer a list of all your assets. Every part of your financial record will be laid bare. The kind of trust to give to a lawyer is difficult, but necessary. That is why you need to find an attorney who is understanding and will treat you with respect.

Attorneys You Can Trust
At Behm Law Group, you will find the combination of experience and sensitivity that you need. Not only are we leaders in our field, we will treat you with the compassion and understanding you deserve!

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Payday Loan Predators

When they hunt, predators don’t look for strong or healthy prey — they seek out easy, unsuspecting victims. This is true both in the animal world and in the financial world. When times get tough, unscrupulous lenders promise easy money in the form of payday loans to people who are in trouble. A payday loan might seem like an easy short-term solution. However, it will give a financial predator an opportunity to sink its teeth into you, and you will be in worse trouble than before.

A payday loan is easy to get. All you usually have to do is show the lender your pay stubs to prove you have an income. Payday loans, though, often come with extremely high fees, sometimes up to 30% of the loan. For example, say your paycheck is $1,500, and you borrow $300. When you get paid again, the lender takes back the $300 plus a fee of up to $90 so that only $1,110 remains. Most likely, that $390 shortfall will leave you with not enough money to pay for all of your expenses. Therefore, you are forced to go back to the payday lender and get another loan, and your debts can quickly spiral out of control.

If you are in financial trouble, don’t go to a predator. Find someone who wants to help you, such as a financial counselor. Sometimes, though, not even a financial counselor can help, and you need the services of an experienced Minnesota bankruptcy attorney. Unlike the payday loan predators, a bankruptcy lawyer can help put an end to the cycle of borrowing and debt. At Behm Law Group, we specialize in assisting people through their financial troubles. Bankruptcy is our specialty, customer service is our passion. Give us a call and see how we can help.

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Are All Debts Discharged After a Bankruptcy?

When faced with crushing debt and no light at the end of the financial crisis tunnel, many folks turn to bankruptcy in order to protect themselves from over-zealous creditors, collection agencies, and the possibility of being sued. While many types of debt can be discharged during a bankruptcy, the slate may not be totally wiped clean when it comes to debt.

There are certain types of tax debt that cannot be discharged during a bankruptcy. In spite of the fact a tax debt may feel beyond your means to repay, bankruptcy may not erase that debt. Another required payment that cannot be discharged is child or spousal support. When you have been determined as legally obliged to make these payments, a bankruptcy cannot remove that obligation. Student loan debt can add a serious amount of stress to a financial predicament, but in many cases that debt cannot be discharged through a bankruptcy.

Another area which can provide severe difficulty during a personal financial crisis is any type of debt that a person has sustained as the result of damages they have been ordered to pay, resulting from an injury they were judged to have caused. If a judgment was reached against you, and damages were awarded to another party as a direct result of your actions, that debt cannot be discharged through a bankruptcy proceeding.

While many of the previous reasons why a debt may not be discharged sound solid, there can be other factors which require consideration before a determination can be rightfully reached regarding a particular type of debt. These types of debt can be quite complicated and require the skills of a highly experienced bankruptcy attorney. If you are contemplating bankruptcy and wondering if you have a debt that you may not be able to have discharged, give us a call at Behm Law Group and we can help you sort through you options and provide the best results obtainable regarding your case.