Resolving Medical Bills and Other Debt Relief in Mankato, MN, with Bankruptcy

In the United States, the cost of healthcare is high, even with medical insurance. This expense is often a cause of much hardship for those who encounter medical costs of any kind, expected or otherwise. These expenses put pressure on household finances during an already stressful and often emotional time. If you are facing unmanageable hospital bills and medical expenses on top of other common debts (e.g., credit cards, mortgages, car loans, taxes), you can find debt relief that offers long-term, effective results by filing for bankruptcy. With the help of Behm Law Group Ltd., you can file a successful case and receive debt relief in Mankato, MN, from your medical bills and other debts.

 

While filing for bankruptcy may seem drastic, it is the most effective and direct way of resolving your medical expenses in addition to many other debts. Instead of working through the red tape of most hospital administrations without the assurance that your debts will be resolved at all, consider filing for bankruptcy, which kills several birds with one stone with the treatment of many debts and a guarantee that your medical bills will be completely dissolved.

 

Because medical bills are considered an unsecured debts, they will be fully discharged in any type of bankruptcy you can file for as an individual.

 

Chapter 7

As a liquidation type of bankruptcy, Chapter 7 discharges debts in exchange for the liquidation of your non-exempt assets. In most cases, the bankruptcy exemptions that are available to you are more than sufficient to protect all of your property from liquidation.  Unsecured debts such as credit card debts, and of course, medical bills, are discharged in full. Chapter 7 is the quickest and most expeditious type of bankruptcy to treat unsecured debts because the process usually takes only three to four months to complete.  However, you must pass the Means Test in order to prove you qualify for chapter 7 debt relief by showing that your household income is not greater than the state median income for a household of your size.

 

Chapter 13

Chapter 13 is a debt reorganization form of bankruptcy. Also referred to as wage-earner bankruptcy, Chapter 13 is an option available to those with an incomes too high to file for Chapter 7 or for those who want to protect their non-exempt assets from possible liquidation.  Chapter 13 reorganizes your debts into a manageable three- to five-year repayment plan. This means that you will pay your unsecured debts what you can afford to pay for a limited time with no interest, no late fees and no penalties.  At the end of your three- to five- year plan, whatever amounts of your unsecured debts that remain are discharged.

 

In a nutshell, filing for bankruptcy will ensure your relief from medical bills, and in most cases, many other debts as well. To learn more about filing for bankruptcy and receiving debt relief in Mankato, MN, contact Behm Law Group Ltd. at (507) 387-7200 today.

Why Student Loans are Leading to Increased Rates of Chapter 7 Bankruptcy in Owatonna, MN

In many countries across the world, a college degree is considered necessary to enter a majority of job markets, and a bachelor’s degree is often viewed as the minimum standard for education. In the U.S., over 65% of high school graduates attend college, university, or other forms of higher education. The experience and certifications higher education provides are important to many students, but with the rising cost of tuition, a college degree can lead to financial troubles down the road.

Under the weight of large student loans, many college graduates are finding it difficult to keep their heads above financial waters. If you’re struggling to meet monthly debt requirements for any reason, Behm Law Group, Ltd. can help you determine whether filing for bankruptcy is the right choice. If you’re considering filing, our expert attorneys can guide and protect you from start to finish during a Chapter 7 bankruptcy in Owatonna, MN.

Student loans rates have increased significantly over the past ten years in the U.S. A recent study showed that 32% of yearly bankruptcies in the U.S. were driven primarily by student loan debts. Those that filed on the basis of student loan debts reported that almost 50% of their debt was made up of federal or third-party student loans. The total of U.S. student loan debt in 2019 is hitting a record high at $1.5 trillion and averaging at about $30,000 per student.  According to a July 24, 2018 Forbes article, the cost of attending a university and obtaining a degree has increased 8 times faster than wages.

With the highly competitive job market and the requirement of even further education within many career paths, new graduates are struggling to repay loans while facing the additional financial requirements of adult life. For many individuals, this struggle meets a breaking point, and bankruptcy or other forms of debt relief must be considered.  According to a May 24, 2012 Forbes article, the cost of higher education has risen 500% since 1986.

 

Student Loans and Chapter 7 Bankruptcy

In any type of bankruptcy, it is possible to discharge student loans. However, the process can be protracted, difficult and expensive.  In order to have student loans discharged in bankruptcy, you must actually sue the student loan lender in bankruptcy court and alleged uncommon financial and personal circumstances which would demonstrate undue hardship.   If one proves up circumstances demonstrating undue hardship, the bankruptcy court will discharge one’s student loans.  Typically, the process is unavailable to someone, however, because of the costs and time involved. So why would filing for Chapter 7 bankruptcy help college graduates with 50% of their debt in student loans?

 

Put simply, Chapter 7 bankruptcy discharges the majority of other common debts, including credit card debt, car loans, mortgages, medical bills, and personal loans. The process resolves these debts with a liquidation of non-exempt assets in exchange for debt discharge. Typically, in most cases, the bankruptcy exemptions one has available in bankruptcy are very generous and are sufficient to protect all of one’s property and the only things that one loses in bankruptcy are ones debts.  Chapter 7 bankruptcy is the most commonly filed and the most directly effective process of debt relief. However, it’s not a process everyone qualifies for. To be eligible for Chapter 7, filers must pass the Means Test to prove their debt-to-income ratio is severely out of balance. With the high numbers student loans censuses show, almost all college graduates struggling financially can qualify for Chapter 7 bankruptcy.

 

If you’re having a hard time meeting your debt payments due to student loans or other factors, contact Behm Law Group, Ltd. today at (507) 387-7200 to learn more about filing for Chapter 7 bankruptcy in Owatonna, MN.

Authors, Artists, and Other Creatives Filing for Chapter 7 Bankruptcy in Redwood Falls, MN

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.

When Corporations, LLCs, and Other Businesses File for Chapter 7 Bankruptcy in Mankato, MN

Running a business is a difficult venture, and even with support systems in place, the enterprise can go wrong. Whether it’s sudden or gradual, debts can overcome a business income and leave no other option than some form of debt relief. Debt relief options vary, but the most effective solution for the long term is to file for bankruptcy. Corporations, LLCs, and other businesses that are not sole proprietorships or partnerships can file for two forms of bankruptcy: Chapter 11 (reorganization bankruptcy) or Chapter 7 (liquidation bankruptcy). Individuals and businesses alike can find guidance when filing for Chapter 7 bankruptcy in Mankato, MN, with the help of Behm Law Group Ltd.’s attorneys.

 

Chapter 7 works similarly for individuals and businesses, but with slight differences. The primary function of Chapter 7 is to liquidate the filer’s assets in exchange for debt discharge. Individual filers may claim exemption allowances to protect certain properties (e.g., the homestead exemption protects the filer’s home from liquidation), but businesses have no such exemptions to claim.

 

How Chapter 7 Bankruptcy Works

Corporations, LLCs, and business formats that are not tied to the owner’s personal debts can petition for Chapter 7 to discharge all of their business debt. Compared to an individual consumer Chapter 7 bankruptcy case, business bankruptcies are fairly cut and dry.

 

Filers work with an attorney to build their case, including all the required documents and financial records. When the petition is submitted to the court and all necessary bankruptcy fees are paid, the court appoints a trustee to handle the liquidation of the business assets. Properties, equipment, business accounts, and any other components of the bankruptcy estate are sold. Creditors are paid with the value of those sales, and the trustee takes his or her commission based on a percentage of the values received.

 

When the assets are liquidated and the trustee distributes the sale proceeds among the creditors of the business, the court will then discharge unsecured business debts, including credit card debt, utilities owed, lease obligations, loans, and other business debts. When this process is complete, the business filing is shut down, effectively ending operations.

 

Chapter 7 bankruptcy is a highly effective debt relief process for businesses, though it’s undeniable that your company will be closed down. Many large U.S. businesses, such as Lehman Brothers in 2008, have used Chapter 7 to rid themselves of debt and shut down. Lehman Brothers filed with $691 billion in assets and $619 billion in debt. This was a case that affected hundreds of employees, but for the long term, was a positive solution for all involved.  In many cases, after the bankruptcy process is completed, one can create a brand new business operation that does the same work as the business that filed for bankruptcy relief and one can operate much more efficiently and smoothly without all of the debts that encumbered the former business.

 

If your business is struggling to keep the lights on and hasn’t had success negotiating with creditors or finding other ways of resolving debt, filing for Chapter 7 bankruptcy may be the final option. Filing will release you from all your business debt effectively, though it will just as effectively close down your business operations.

 

To learn more about filing for Chapter 7 bankruptcy in Mankato, MN, as a business or individual, contact Behm Law Group Ltd. at (507) 387-7200 today.

How Bankruptcy Debt Relief Can Stop Legal and Illegal Creditor Debt Collections in Jackson, MN

Whenever you take a loan, whether it’s in the form of a mortgage, car loan, credit card, or otherwise, you become a debtor, and the loan provider becomes a creditor. The relationship between you and your creditors is generally a perfectly amiable, professional one if you’re able to meet your monthly payment requirements. If you find yourself in a position of being unable to meet those monthly payments, that relationship may start to change to something less amiable, and in some cases, less professional. With the protection of Behm Law Group, Ltd. attorneys, you can put a stop to creditor debt collections and find debt relief in Jackson, MN by filing for bankruptcy.

 

Anyone who has been in the position of being unable to repay their debts may know something about just how ugly creditor debt collection practices can get. Filing for bankruptcy can quickly resolve any issues you may be facing from your creditors’ collections attempts as well as provide a long-term solution for debt relief. Whether you file for Chapter 13 bankruptcy and have your debts reorganized into a repayment plan that is suited to your financial circumstances, or for Chapter 7 bankruptcy and have your non-exempt assets liquidated in exchange for a discharge of your debts, you receive the benefits of an automatic stay.

 

The moment you file for any type of bankruptcy, the court automatically places a stay on your creditors’ ability to collect debt. This stay, with the additional protection of a bankruptcy attorney, should put a stop to any creditor debt collection attempts, legal or illegal.

 

Legal Creditor Actions 

Before you file for bankruptcy and receive automatic stay protection, creditors are allowed to collect debt according to the Fair Debt Collection Practices Act (FDCPA). This means they can directly attempt collections and negotiations with you for the first six months you are delinquent. After that time period, your creditors can bring in a third-party collection agency. These collectors can communicate with you directly unless you have attorney representation, in which case that agency must work with your lawyer. If your original creditor sells your debt, the buyer of the debt must also abide by the FDCPA laws.

 

Illegal Creditor Harassment

The moment your creditors or collection agents attempt to collect outside of the laws the FDCPA outlines, they enter harassment territory. Illegal harassment actions include anything from calling you repeatedly at inconvenient times or places, calling you when they should be calling your lawyer, contacting your family members, threatening you, misleading you about their identity, threatening you with jail time and much more. Learn more about illegal debt collection here.

 

Illegal and legal debt collections alike are halted with an automatic stay that goes into effect the moment you file for bankruptcy. For more information about bankruptcy and debt relief in Jackson, MN, contact Behm Law Group, Ltd. at (507) 387-7200 today.

Exemptions for Chapter 7 Bankruptcy in Pipestone, MN

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

 

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

 

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

 

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

 

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

 

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

 

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

Navigating through Bankruptcy Delays with the Help of a Bankruptcy Attorney in Marshall, MN

Bankruptcy can be a highly effective way to find the financial relief you need for long-term stability. It can also be one of the most emotionally difficult legal processes you ever go through. Because bankruptcy is such a legally-nuanced process, it can be one of the most trying court-administered procedures for individual consumers to face—especially if they choose to start a case without the help of a knowledgeable bankruptcy attorney. If you are struggling to meet debt payments, but are hesitating to take the leap into filing for bankruptcy for fear of the difficulty and emotional toll it may take, it may be time for you to seriously think about how a lawyer can help. Behm Law Group Ltd. provides the legal counsel, advice, and comprehensive guidance you need from a bankruptcy attorney in Marshall, MN, and the surrounding area if you plan to file.

Whether you choose (and qualify for) Chapter 7 liquidation bankruptcy or decide to restructure your debts into a three- to five-year repayment plan with Chapter 13 bankruptcy, Behm attorneys can navigate each step of the process as well as advise you on the best bankruptcy choice before you even have to make a decision. When you enter a bankruptcy case, lots of information is thrown your way. While this can be overwhelming, our bankruptcy attorneys are here to tell you what everything means and how to proceed.

One part of bankruptcy many past filers have found difficult to work through is the occasional delay the court may have to pause action on your case.

 

Delays

Bankruptcy case delays occur for a number of reasons, some of which may be your responsibility and some of which may not. While there are many types of delays to a case that can occur out of unusual circumstances, the most common types of delays include:

  1. Missing information: If you have information the court needs that is not a part of a standard petition, your case may be put on delay while you gather the necessary documents and during the court’s review of them.
  2. Creditors’ requests for information: If creditors request information about your case, the court may put a pause on the proceedings until the creditors are informed in full.
  3. Creditors’ claims: Sometimes, creditors may have grounds to claim an asset is their property or that their debt is non-dischargeable. This may occur for a wide range of reasons, but if it does, it’s incredibly important to have the protection and assistance of a bankruptcy attorney.
  4. Your income: If you have initially filed for Chapter 7 and your income changes before you start your case (with a new job, for example), the court may delay your case while it decides whether you qualify for a Chapter 13 bankruptcy.

 

If you are considering filing for bankruptcy, don’t underestimate the necessity of a bankruptcy attorney in Marshall, MN, and the surrounding area. Contact Behm Law Group Ltd. at (507) 387-7200 to learn more today.

Resolving a No-Asset Case with Chapter 7 Bankruptcy in Worthington, MN

If you own a car or house, you are like most other U.S. citizens in the fact that you possess an asset. Additionally, your property may be like most others if it’s tied to a loan agreement. Because of the high cost of housing and vehicles as well as many other necessary or luxury properties, financing agreements are quite common, and there are a range of ways you can enter into these agreements. While loans are very useful for you to acquire what you need in your daily life, they can also pose problems if you are unable to repay your debts. Behm Law Group, Ltd., can help you recover from burdensome debts and protect your property from liquidation by filing for Chapter 7 bankruptcy in Worthington, MN.

 

Filing for Chapter 7 bankruptcy may seem drastic, but in the long term, it can actually be one of the most effective ways to recover from onerous debts that you could struggle with for much longer if you didn’t file for bankruptcy. Though there are compromises you have to face in the process of filing for bankruptcy, the overall advantages can greatly outweigh the disadvantages.

 

Chapter 7 bankruptcy is a legal process through which your non-exempt assets (properties) are liquidated (sold). The money from the liquidation/sale process is then distributed by the chapter 7 trustee administering your case to repay some dividend to your creditors (lenders), and in return, your debts are discharged (dissolved). However, because the U.S. Bankruptcy Court does not want to leave people who file for Chapter 7 bankruptcy destitute and unable to reorganize and contribute to the national economy, it allows filers to claim exemptions on their properties.

 

These exemptions protect certain values or equitable interests as to your properties, from your home to your car to some luxury items. Because of the allowances your claims to exemptions provide, most Chapter 7 individual consumer cases are considered “no-asset” cases because the bankruptcy exemptions are typically sufficient to protect any values or equitable interests that you have in those assets.

 

No-Asset Cases

While there are technically assets involved in virtually every Chapter 7 bankruptcy case, your trustee and the court take the exemptions you claim into consideration when determining a no-asset case. Simply put, if your claimed exemptions don’t allow the liquidation of major asset values, your trustee will not pay your creditors anything.

 

This means your trustee won’t get paid any additional amounts from your case beyond his or her typical per case fee of $60.00. It’s similar to the situation of salespeople who are paid commission on top of base wages when they make a sale. If they don’t make a sale, they aren’t paid any extra commission wages.

 

Your trustee may also consider your case to be no-asset if the majority of your properties are exempt from the bankruptcy process. From the perspective of bankruptcy filers, a no-asset case usually bodes well because they will be able to protect their property from liquidation.

 

If you are considering filing for Chapter 7 bankruptcy in Worthington, MN, and want to learn more about exemptions, assets, and liquidation, contact Behm Law Group, Ltd., today at (507) 387-7200.

Bankruptcy Fees Today and Special Fee Circumstances for Chapter 7 Bankruptcy in Pipestone, MN

Filing for bankruptcy may seem like a drastic measure, but it’s actually a highly effective way for individuals to recover from severe financial difficulties and regain stability in more ways than one. The process of bankruptcy is designed to benefit both the debtor and the creditors involved in the case with a court administered application of either asset liquidation in return for debt discharge or debt reorganization into a manageable repayment plan. Whether you’re struggling with unexpected, sudden debts or you have accumulated debts over time, Behm Law Group, Ltd. provides the legal counsel and support you need to file a successful case for Chapter 13 bankruptcy or Chapter 7 bankruptcy in Pipestone, MN.

No matter what type of bankruptcy you file for, liquidation or reorganization, the court will require you to meet several requirements in order to submit your petition, including paying the current bankruptcy fees.

Chapter 7 Bankruptcy Fees

The filing fee itself for Chapter 7 bankruptcy is $335.  If your case is closed and you have grounds to reopen it later, you will have to pay another $335 fee.

Chapter 13 Bankruptcy Fees

To file a Chapter 13 petition, you’ll be required to pay a filing fee of $310. To reopen a Chapter 13 case, you’ll have to pay another fee of $310.

Any additional bankruptcy fees and information about putting together your petition are provided on the U.S. Court website, including all the necessary forms and files you need to file.

If you’re struggling so severely that even these initial bankruptcy fees are outside of your budget, the court offers two options. You can apply to pay the filing fee in installments or you can apply to have the filing fee waived completely. In order to qualify for an installment plan you have to state your inability to pay the fee upfront and you must be able to pay it within no more than four installments. To qualify for a waived fee your income must be 150% below the Minnesota poverty line and you must be unable to pay an installment plan.

In the event you can’t pay the bankruptcy fee upfront, it’s almost certain that you’ll have to file for Chapter 7 bankruptcy. Because of case requirements and the fact that you’ll still repay some of your debts during a Chapter 13 repayment plan, filers with incomes too low for even bankruptcy filing fees are not expected to choose reorganization as a viable bankruptcy option. Conversely, if you have an income high enough to pay the bankruptcy filing fee, you may well not qualify for Chapter 7 bankruptcy.

To learn more about the fees involved in filing for Chapter 13 or Chapter 7 bankruptcy in Pipestone, MN, or to get started on your case, contact Behm Law Group, Ltd. at (507) 387-7200 today.

 

How Predatory Lending Can Force You to File for Bankruptcy in Owatonna, MN

When it comes to navigating loans, it can take a frustrating amount of information and savvy to negotiate the process from start to finish. Whether you need support to buy a car, pay medical bills, finance your business, or for any other purpose, finding the right lender is the most important step. Unfortunately, there are lenders out there who take advantage of their ability to loan money. They ruthlessly drive borrowers out of income, compromise property ownership, and even force debtors to file for bankruptcy.

Predatory lenders are a continuing problem in the U.S., but there are those out there who want to hold these vicious creditors accountable. Behm Law Group, Ltd. is dedicated to providing counsel to those considering filing for bankruptcy in Owatonna, MN, and protection from predatory lenders.

As a graduate of Max Gardner’s Bankruptcy Boot Camp, Stephen Behm is committed to fighting predatory lenders and holding them accountable in defense of his clients. If you’re facing an aggressive creditor practicing the following common predatory practices, Behm Law Group, Ltd. can help protect you throughout your bankruptcy case.

 

Predatory Lender Practices

  1. Misrepresentation: Limited disclosure (or even false disclosure) of the terms of a loan including costs, time frames, risks, and any other fine print obligations is an immediate red flag of predatory lending.
  2. Inflation: Increasing the cost of loan documents, closing charges, and preparation fees is also a frequent practice of disreputable lenders. Adding in the cost of additional components like credit insurance can also mark an untrustworthy lender.
  3. Refinancing: Lenders that offer refinance loans based on home equity or offer refinancing on existing loans often push debtors to borrow more than they can pay off and impose higher interest rates and hidden fees. Additionally, refinanced mortgages from predatory lenders commonly impose balloon payments that are lower at first and quickly rise.
  4. Neighborhood targeting: Predatory lenders often target low-income neighborhoods, offering loans with higher interest rates for every debtor without regard to those individual debtors’ credit history, income, or otherwise ability to meet payments.

All these practices, including several other victimizing actions a creditor may impose on a debtor, characterize a predatory lender. Debtors that have fallen into the trap of a predatory loan can quickly find themselves in over their heads with financial difficulties. These practices contribute to a large number of bankruptcy cases in the U.S., most of which are filed under Chapter 7. If you’re struggling with the effects of predatory lending and are unable to meet monthly debt payments, filing for bankruptcy might be the right choice for you.

If you choose to work with Behm Law Group, Ltd. to file your bankruptcy case and halt creditor action, you can trust our attorneys to fight predatory lenders. Contact us today at (507) 387-7200 to learn more about filing for bankruptcy in Owatonna, MN.