Posted on

How Minimum Wage Can Affect Bankruptcy in Fairmont, MN and Across the State

State economies are affected by a range of factors, both within the state itself and by national or global determinants. The condition of a state economy will have its own impact on the cost of living, availability of jobs, wages, and more. Minimum wage is directly affected by the state economy, which means it should change over time to accommodate employees fairly.

 

Any changes to minimum wage will impact workers and employers alike, though this effect may manifest in many different ways. For some employers, an increase to minimum wage may stretch their finances to a breaking point. If a recent change in minimum wage, in addition to other factors, has led your small business into dangerous financial waters, Behm Law Group, Ltd. can help you file for bankruptcy in Fairmont, MN.

 

In January of 2019, Minnesota raised the minimum wage by 2.16% to a rate of $9.86 per hour for large employers and $8.04 per hour for small employers (and for underage employees). This change in minimum wage reflects the nearly annual changes in inflation, which means it will have positive and negative effects to all parties involved.

 

For employees, the increase in pay will have a very positive impact on their lives. For employers, on the other hand, even a small increase in minimum wage can impose a much higher cost of worker compensation.

 

For large employers, this increased expense doesn’t usually create a serious impact, but small businesses can take a hit. Businesses established as a sole proprietorship or a partnership in particular will have a harder time compensating for minimum wage increases over time because the owner’s personal debts include all their business debts.

 

If you own a small business as a sole proprietorship or partnership and are struggling with the changes to minimum wage in addition to other expenses, Behm attorneys can help you petition for Chapter 13 or Chapter 7 bankruptcy relief.

 

Chapter 13 bankruptcy provides a debt reorganization plan that gives you a three to five-year repayment period and discharges portions of your debts. This type of bankruptcy also allows you to keep your business running with long-term stability.

 

Chapter 7 is a bankruptcy process available to all types of businesses, big or small. This chapter works to discharge debts in exchange for the liquidation of non-exempt assets. It’s one of the most effective bankruptcy processes in terms of concretely resolving debts, but it could require you to shut down your business for the foreseeable future.

 

Owning and operating a business is a difficult profession, and it can quickly become more difficult with small changes like the increase in minimum wage this year. If you’re considering filing for bankruptcy in Fairmont, MN to find debt relief for your business, contact Behm Law Group, Ltd. at (507) 387-7200 today.

Posted on

Why Many Local Restaurants File for Chapter 7 Bankruptcy in Jackson, MN

Running a business is a difficult endeavor, especially if it’s a young company. Maintaining a steady income and company growth means battling on several different fronts and working through many different expenses. Not only do the local economy and your business marketing endeavors affect your business standing, but also the national and even global economy play a role as well. Additionally, some businesses are even more difficult to run than others. Restaurants, for example, are notoriously difficult to maintain successfully. Behm Law Group Ltd. has helped many people work through a Chapter 7 bankruptcy in Jackson, MN, and the surrounding area.

 

If you find yourself facing a business bankruptcy after your restaurant becomes impossible to maintain, you’re not alone. Every year, many restaurants close due to bankruptcy, each case with its own unique set of circumstances. Despite the differences among cases, we can often highlight several common factors that played a part in the situation leading up to a bankruptcy.

 

Common Factors Playing a Part in Bankruptcy

 

  1. Capital: Restaurants require a lot of capital to operate. Not only does this include expensive kitchen equipment, restaurant-specific building systems, staff facilities, a large supply of furniture, registers/accounting systems, uniforms, and many other concrete items, they also include a range of food types with varying shelf lives. Building maintenance and restaurant operations are more expensive than almost any other service company.
  2. Licensing and Property: Liquor licenses, health inspections, zoning laws, rent, property taxes, and many other restaurant requirements are sky-high for restaurants. With the food service industry booming in the United States, state and municipal governments put restrictions on opening restaurants with these licensing and property expenses. In addition, federal health and food safety certification requirements put further strains on business incomes.
  3. Market Saturation: Another effect of the booming restaurant industry is market saturation. Restaurant customers are picky and they are eager to try new things and they are constantly demanding newer options and better quality. This results in a restaurant market that is highly saturated with many different types of restaurants that provide stiff competition to anyone else trying to make a living in the area. All of this means it’s extremely difficult to succeed based on market saturation alone, let alone in addition to other obstacles.

 

All these factors make restaurants a unique business in the fact that they are more difficult to run and more likely candidates for bankruptcy than most other companies.

 

Restaurant owners who file for Chapter 7 bankruptcy will face the good and bad of their situations. Chapter 7 works to liquidate some business assets in exchange for the discharge of debts, including mortgages, personal loans, equipment debts, and more. However, in many cases, this discharge comes with the reality of having to close down operations. It’s not impossible to reopen a restaurant again in the future, but for the time being, filers usually shut down their businesses.

 

If you are considering filing for Chapter 7 bankruptcy in Jackson, MN, contact Behm Law Group Ltd. at (507) 387-7200 to learn more about restaurant bankruptcy cases.

Posted on

How Filing for Personal Bankruptcy in St. Peter, MN Affects Your Community

If you’re struggling to meet monthly debt payments and feeling the weight of your financial difficulties, it may be time for you to consider some form of debt relief. For many individual consumers and businesses, filing bankruptcy is a highly effective form of debt relief that provides long-term beneficial results.

 

It’s true that bankruptcy has some negative side effects, specifically to your credit, but the advantages far outweigh these effects in the vast majority of cases. Filing may be your ticket to a better financial situation that lasts the rest of your life. With the help of Behm Law Group, Ltd. bankruptcy attorneys, you can determine which type of bankruptcy in St. Peter, MN is right for your situation, and you can put together a successful case that gives you the best results possible.

 

Bankruptcy is a legal process designed to help debtors and creditors alike. It’s a system that recognizes the situation that debts have put filers in but also understands that creditors deserve some kind of recompense for debts owed. This balance of treatment to creditors and debtors that bankruptcy creates is because it’s structured on a nuanced, complex system intertwined into the economic structure at all levels. This means that, overall, bankruptcy provides a support system for every party involved  including borrowers, lenders, and all other financial people/organizations at every financial level.

 

If you choose to file for bankruptcy, the following parties will be affected (not including you and your creditors), both directly and indirectly:

 

  • Family/Friends: Both emotionally and financially, your friends and family may be affected by your bankruptcy. This may appear in several ways depending on your situation. First and most directly, any personal loans you owe to family and friends may be discharged or reorganized into a repayment plan, making whichever loved one that gave you the loan into a creditor involved in bankruptcy. This can put serious stress on a personal relationship, but in addition to this, your loved ones will most likely be made aware of your financial status.

 

  • Local Economy/Government: In many ways, even one bankruptcy affects a municipal government and, in turn, a local economy. No matter the size of your rural or urban area, citizen finances are tied together, which means a bankruptcy in the area will reflect on the local economy. Your bankruptcy may be one of few, but more bankruptcies mark a potentially struggling economy and a local government that will have increasing difficulties in supporting its community. This system is all cyclical, but bankruptcy plays a part in returning that cycle to a positive side.

 

Bankruptcy can also affect the global economy in ways as well, but like many other financial matters, everything occurs on a gradual and cyclical scale.

 

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

 

Posted on

Understanding and Navigating What You Might Face after Filing Bankruptcy in New Ulm, MN

Life has its ups and downs, which is a cliché, yes, but clichés are often rooted in simple truths. While some individuals and businesses won’t experience as extreme a financial event as bankruptcy, it certainly affects those who do file in many ways. The emotional and mental stresses of financial struggles aside, bankruptcy has its own effects on a filer’s life before, during, and after a case is closed. If you are considering filing bankruptcy in New Ulm, MN, Behm Law Group Ltd. can help you build a strong petition, meet pre-bankruptcy requirements, follow through with your case, and complete the process successfully with as little stress as possible.

 

Behm attorneys are skilled, knowledgeable, and experienced in handling a wide range of Chapter 7, Chapter 13, and Chapter 12 cases, and we have the means to protect and help you through your entire case.  After a bankruptcy is completed, however, you may face a few challenges.

 

As with people who have not filed for bankruptcy relief and who may have bad credit, there are three instances when bankruptcy filers can be discriminated against.

 

  • Loans: Your post-bankruptcy credit scores will not be what they were pre-bankruptcy. Your scores will take a hit, but you can still build up your score over time. Despite this, you may have a hard time getting new loans after filing. Lenders can turn you down for loans or charge higher interest rates on an accepted application. If you are in a credit counseling program, you may experience difficulties getting financing as well.   Many people who file for bankruptcy relief may actually have great credit scores.  However, they are typically unable to do anything even with great credit scores because their debt to income ratio is so skewed.  Simply put, any great credit scores are entirely illusory because people simply have too much debt already and they do not have sufficient income to materially reduce that debt.  Creditors will not make further loans to you when they see that your income is insufficient to pay and materially reduce the debt that you already have.  After a bankruptcy is completed, you may have a poor credit score but, paradoxically, you may be more credit worthy than you were before.  In many ways, bankruptcy “leans you up” debt-wise because you get rid of most, if not all, of your debts.  In many ways, you are like Pinocchio because you don’t have any “debt strings” or you have a lot less of them.  Additionally, you will not qualify for bankruptcy relief again for several years.  Oftentimes, creditors, even the ones you may have included in a bankruptcy case, see this and they are incentivized to work with you again.   They understand that they would get to be first or second in line to get paid by you after a bankruptcy instead of being tenth or fifteenth in line to get paid before a bankruptcy filing.  They also understand that they could garnish your wages and levy on your bank accounts if you don’t pay them and that you would not be able to do anything about it because you would not qualify for bankruptcy relief again for several years.  Therefore, even after a bankruptcy filing, creditors often consider you a very attractive credit risk.

 

  • Employment: Unfortunately, private employers can pass judgment on your application if they know you have filed for bankruptcy or see that you have a lower credit score than other applicants. Most employers wouldn’t want to hire people who are handling a personal issue as significant as bankruptcy or poor finances as there is a chance the financial issue will affect their job performance. Being open and straightforward with employers can help you get through this prejudice, but sadly, it won’t always help them ignore your circumstances.  However, this also happens frequently with people who have poor credit scores and who haven’t filed for bankruptcy relief.  Often, potential employers will see that your situation is more manageable and secure after a bankruptcy than it was before and that you have been freed of the mental anguish and emotional stressors that you had before.  They know that they will not be served with a garnishment summons on your wages because your debt issues have already been taken care of.

 

  • Renting: Like lenders and employers, landlords may also tend to discriminate against potential renters based on their credit scores or recent bankruptcy cases. Understandably, landlords need tenants to pay rent on time. This means they may place judgment on potential renters based on their credit scores. In the eyes of a landlord, it’s simpler and easier to judge based on credit scores than the many other factors that could be involved.

 

In general, you can avoid these post-bankruptcy issues, but if you do experience them, there are ways to navigate these difficulties. To learn more about the process of filing bankruptcy in New Ulm, MN, and life after filing, contact Behm Law Group Ltd. at (507) 387-7200 today.

 

Posted on

Rebuilding Your Business or Starting Fresh after Bankruptcy in Marshall, MN

Owning and operating a business is a difficult endeavor, no matter how small that business is. This is why many businesses find themselves in a financial situation that is less than desirable. If your business is facing debts you’re unable to repay, filing for bankruptcy may be your saving grace in preventing further struggles down the road. With the help of Behm Law Group Ltd., you can file a successful case for bankruptcy in Marshall, MN, and even rebuild your business and your credit after your bankruptcy case is concluded.

 

Business bankruptcies vary depending on the legal status or structure of the business. Any corporations, LLCs or other business formats that have a separate legal and financial standings from their owners typically can file for Chapter 7 or Chapter 11. On the other hand, sole proprietorships and partnerships are directly tied to the owners’ personal assets and personal debts/liabilities, which means they can file for Chapter 7 or Chapter 13.

 

For all types of businesses, the Chapter 7 process works in the same way to liquidate business assets (properties, accounts, etc.) in exchange for the discharge of debts. In any Chapter 7 business case, the business is typically closed when the case is completed.

 

Though Chapter 11 and Chapter 13 work similarly to reorganize business debts into a manageable repayment plan, there are some differences. For small businesses, Chapter 13 is often ideal for many reasons. Learn more about the benefits of Chapter 13 here.

 

No matter what type of bankruptcy you file, your business can face a range of challenges down the line. From shutting down your business completely to severely lowering your credit standing, bankruptcy can force significant alterations or changes but those alterations or changes, in most cases, are both rehabilitative and beneficial long-term. It’s absolutely possible to rebuild your business and your credit after filing for bankruptcy relief, whether this means starting anew or rebuilding through a debt repayment plan. Every case is different, but there are some strategies that every business owner can do to rebuild after a bankruptcy filing:

 

  1. Change the way you budget. Something led to your business bankruptcy, and whether that was caused by your actions or by external reasons over which you had absolutely no control, you can make changes in your budget to prepare for challenging financial times. Creating a conservative spending and generous saving plan is often a vital step.
  2. Focus on rebuilding your credit. When your credit is good, your business can use that advantage to expand, which in turn, opens many other doors. Your credit will take a hit after bankruptcy, but you can take small actions to slowly rebuild it. Take care to pay all bills on time, meet your debt requirements, communicate often with your creditors and stay away from just paying the monthly minimum payments.
  3. Consider separating your business finances from your own. When you can (i.e., have the funds and are not on a Chapter 13 debt repayment plan), establish your business as a corporation or LLC (not a sole proprietorship or partnership) to protect yourself from any financial issues.

 

To learn more about how to rebuild your business and your credit after filing for bankruptcy relief in Marshall, MN, contact Behm Law Group Ltd. at (507) 387-7200 today.

 

 

Posted on

Five Things You Might Not Expect About Bankruptcy in Windom, MN

Because the average individual is not an expert on the legal nuances of bankruptcy, it’s understandable that most people use the internet as a guidebook for the process. While there are a few accurate sources of bankruptcy information online, there are also a lot of myths and general misinformation.

 

When it comes to correct and reliable information, nothing beats a professional opinion. Behm Law Group, Ltd. provides that expert opinion. If you’re considering filing for bankruptcy in Windom, MN, or the surrounding area, Behm Law Group, Ltd. can offer advice and more throughout the process.

 

You can find much about the basics of bankruptcy online, but the basics aren’t quite enough to file a successful case and see it through. Bankruptcy is an old practice, going back to ancient times, though it has evolved over time. Today, bankruptcy has many conditions that can change the course of a case, making it one of the most nuanced legal processes.

 

Because of this complexity, there are many unexpected things about bankruptcy, even as a nationwide occurrence. For example:

 

  1. About 1 in every 70 households file for bankruptcy each year. If you look at your community based on this information, it’s possible you may know someone who is working through bankruptcy.
  2. Almost 50% of households in the U.S. spend more than half their yearly income and have up to $15,000 in credit debt. This addition of credit debt to an already common pile of debts including student loans, mortgages, car loans, and more has led to a rapid increase in the number of consumer bankruptcies per year.
  3. The vast majority of people who file for bankruptcy relief don’t lose any property and only lose their debts.  The bankruptcy exemptions that are available to you to protect your property are typically very generous.  The bankruptcy exemptions you can use and the limitations of those bankruptcy exemptions vary from state to state.  Generally, you must reside in a particular state for two (2) full years before filing a bankruptcy case in order to use or benefit from the bankruptcy exemptions of that state.
  4. The amount of average debt per bankruptcy case has increased over in the past 10 years. An American Bankruptcy Institute report released in 2009 showed that cases averaged $100,000 in debt for individual bankruptcies alone. Business bankruptcies had even greater debt averages per case. This shows there is a notable increase in the time households and businesses are barely making ends meet before filing for bankruptcy.
  5. Bankruptcy has increasingly affected those with a college education as tuitions rise. Each year, college tuitions increase to match the growing inflation our economy experiences. Student loans must be listed, like any other creditor, in the bankruptcy process but they are generally difficult to get discharged, except under specific circumstances.  Student loan debts, in combination with the weight of others, still significantly contribute to bankruptcy filings, however.

 

To learn more about the process of filing for bankruptcy in Windom, MN, or to get started on your case, contact Behm Law Group, Ltd. at (507) 387-7200 today.

Posted on

Lien Avoidance vs. Lien Stripping When Filing for Bankruptcy in Waseca, MN

Anyone struggling to meet monthly debt payments has more options than just slipping deeper beneath the water of financial difficulties. Instead of facing the stress of debt and the emotional toll it creates, those working through financial troubles can find relief within the government sanctioned process of bankruptcy.

 

If you think bankruptcy might be right for your financial circumstances, Behm Law Group, Ltd. can provide professional guidance and support. When you choose to file for bankruptcy in Waseca, MN, as an individual or business, you can gain the benefits of a debt treatment process that will lift the stress of a heavy financial burden.

 

When you file for bankruptcy, you may have many different types of debts to your name. Broadly speaking, the types of debts included in the bankruptcy process are generally secured and unsecured. Your secured debts are tied to or secured by an item of property or real estate, and it’s almost certain that the property or real estate will have liens attached to them.

 

Liens are tied to property loans like mortgages, car loans, and other commonly secured debts that are arranged through lending companies. These liens give the lenders the right to repossess or foreclose on the properties tied to the debts until the debtor pays the debts or the debts are discharged. In the bankruptcy process, mortgage liens can be stripped or avoided, depending on the situation.

 

Lien Avoidance in Chapter 7 Bankruptcy

When you file for Chapter 7 bankruptcy, you’re entering into a liquidation process that works to provide your creditors the value of your non-exempt property in exchange for debt relief. You can protect your properties from liquidation with your available bankruptcy exemptions, however. If there was a lien on a piece property, claiming the exemption is not considered lien avoidance.  Your available bankruptcy exemptions allow you to protect the equity – the value of an item of property above the debt you may owe against it – in your property.  Sometimes, you can avoid a creditor’s lien in full or in part regarding a certain piece of property and use your bankruptcy exemptions to protect the equity you gain from such lien avoidance.  In order to avoid a lien on property, a secured creditor’s lien must be a non-purchase money lien.  This means that the creditor did not give you any financing for the purchase of the subject asset itself.  For instance, if a creditor gives you a loan for home improvements and you give that creditor a lien or security interest in your furniture or a vehicle, farming equipment or some other assets, that creditor has a non-purchase money lien as to those items because it did not give you a loan to purchase them.  Rather, the creditor gave you a loan for some purpose that was completely unrelated to the assets on which you allowed the creditor to have a lien.  Presume that One Main Financial gave you a $10,000.00 loan for home improvements and further presume that you granted it a security interest in your furniture, appliances, and your car.  In a bankruptcy proceeding, you could avoid the entire $10,000.00 lien on those items and use your bankruptcy exemptions to protect the resulting $10,000.00 equity you would then have as a result of having avoiding the lien.

 

Lien Stripping in Chapter 13 Bankruptcy

If you file for Chapter 13 bankruptcy, your debts are reorganized into a manageable repayment plan lasting three to five years. If you have multiple mortgages on your property, you may be able to strip off second and third mortgage liens, if there is no value or equity to the real estate above and beyond the first mortgage.  If the amount of the first mortgage is greater than the value of your home, you’re considered “upside down” on that mortgage debt, and you can strip the junior liens away.

 

To learn more about the different types of bankruptcy chapters and how your liens are handled when you file for bankruptcy in Waseca, MN, contact Behm Law Group, Ltd. at (507) 387-7200 today.

Posted on

What You Can Learn from Public Listings of Bankruptcy in New Ulm, MN

In the U.S., the majority of court cases are put on public record. This includes all bankruptcy filings which are often listed in local newspapers and are always available on the government-administered online database PACER (Public Access Court Electronic Records). The listings available on PACER are not easily accessed by any individual, but they are available to bankruptcy attorney, creditors involved in bankruptcy proceedings, bankruptcy trustees and bankruptcy judges.

 

If you’re struggling to meet debt payments and think that bankruptcy might be right for you, it’s important to understand why and how your case may be listed publicly and could be accessed by a limited number of parties. If you are considering filing, Behm Law Group, Ltd. can provide the guidance and assistance you need when working through bankruptcy in New Ulm, MN.

 

Bankruptcy is given a poor image both in financial and social terms, but the fact is that it’s a vital process for those who are unable to recover from severe debt. For many, bankruptcy is the best way to debt relief and long-term financial recovery.

 

Those planning on filing for bankruptcy can learn some of the basics of the process just from looking at listings local to their area. If your local newspaper lists monthly bankruptcies, it’s likely they will be written out like this:

  • Name of filer
  • Name of any joint filers
  • Address of filer
  • Chapter they filed
  • Date they filed
  • Their assets
  • Their liabilities

 

This is what you can learn from this listing:

  • The name of the filer may tell you if it was a business or individual.
  • The joint filer names tell you that either a spouse or a business partner filed jointly.
  • Their address tells you what region they filed in, and may give you some more information about the financial demographics of that area if there are multiple bankruptcy filings. If you live in the same region, it may give you some peace of mind to know you’re not alone.
  • The chapter they filed for will give you an idea of the bankruptcy process (i.e. whether it was liquidation or reorganization).
  • The date they filed may give information about fluctuations of increases or decreases in bankruptcy cases throughout the year.
  • Their asset amount tells you how much their properties and accounts were worth. This includes physical property, bank accounts, stocks, retirement funds, and any other sources of income.
  • Liabilities represent a blanket term for debts and other unpaid financial obligations. This amount tells you just how much debt might have been resolved through bankruptcy, and it gives you a good comparison of asset to debt ratios.

 

Overall, public postings of local bankruptcy cases give you a great way to compare your own situation with those who found recovery through the bankruptcy process. Generally speaking, Minnesota newspapers choose not to list local bankruptcy filings.  However, newspapers in North Dakota and Iowa do choose to list local bankruptcy filings.  For many reasons, including the possibility of identity theft, newspapers are becoming much more circumspect about listing local bankruptcy filings.  If you believe filing for bankruptcy in New Ulm, MN, might be the right choice for you, contact Behm Law Group, Ltd. at (507) 387-7200 today.

Posted on

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.

Posted on

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.