Chapter 7 Bankruptcy Michigan Lawyer
Bruce Law Firm, a bankruptcy law firm, has experienced bankruptcy attorneys in Monroe, Michigan serving all of Monroe County and Downriver Detroit.
The first and most common type of bankruptcy is the Chapter 7. Chapter 7 Bankruptcy Michigan is one of the two main types of bankruptcy options available to those who live at the state of Michigan. Chapter 7 bankruptcy is meant for people who do not believe they will have the ability to pay their current debt whatsoever, given their financial situation. Our attorneys can provide the general information you need to understand the Chapter 7 process.
Chapter 13 Bankruptcy Michigan is designed for people who believe that they can repay most of their general debt gradually if they were permitted to make a reasonable payment agreement. A Chapter 13 bankruptcy can also provide the legal advice to stop a Michigan foreclosure lawyer to save your home.
Michigan Chapter 7 Bankruptcy Laws are federal law that outline the bankruptcy process.
Electing to file a Chapter 7 bankruptcy is a significant life decision. It is a federal court proceeding filed in the US Bankruptcy Court.
Those who file Chapter 7 in Michigan should fully comprehend all of their legal and financial responsibilities. They will also need to make significant decisions, such as which exemptions to file to protect certain personal assets. After you file you can no longer borrow money without Court permission.
A Michigan bankruptcy attorney can provide legal aid and advice to help you take action that is in your best interest. Your lawyer will also make sure that your filing is completed correctly with all of the required documentation. Your Michigan attorney will also direct you where to complete the required credit counseling. If there’s a problem with your filing, such as a discrepancy in your income, then your bankruptcy attorney in Michigan will help fix it.
How Do I File a Chapter 7 Bankruptcy
Bruce Law Firm provides free consultations for clients who want to consider their financial options. We will look at your income, debts and assets in our consultation and review the different alternatives available. Be sure the information that you provide throughout the consultation and thereafter is complete and correct.
A Chapter 7 Bankruptcy is often called a liquidation or fresh start bankruptcy. A Chapter 7 bankruptcy starts with the filing of a petition with the Bankruptcy Court. Once the petition is filed, the court will assign a bankruptcy trustee to review your case. The filing also starts the automatic stay. The automatic stay prevents your creditors from making any attempts to collect on their debts. This can protect your property from seizure in Michigan such as personal property and wage garnishments.
The court will also schedule a 341 hearing that you will be required to attend. This trustee will review your schedules and ask you questions regarding your case. Approximately 60 days after this 341 hearing, the court will grant a Chapter 7 discharge, and your case will be concluded.
A Chapter 7 bankruptcy will eliminate most unsecured debt. This includes credit card debt, medical bills, repossession debt and most other unsecured debts. It will not eliminate recent taxes, child support, most student loans and other forms of priority debt. If you are buying a house or car, you will want to continue paying on these assets.
Most creditors will want you to execute a reaffirmation agreement in regards to your house or car debt. In Chapter 7 bankruptcy, you usually keep all your property.
Michigan Chapter 7 Bankruptcy Exemptions help you keep your property
Michigan Chapter 7 bankruptcy exemptions provide a generous exemption scheme that allows your attorney to prepare your schedules to ensure you keep all of your personal property. The vast majority of Michigan bankruptcy cases are considered no-asset cases because the attorney has exempted all of the debtor’s property.
You can talk to an experienced Michigan Chapter 7 Michigan bankruptcy exemptions attorney about your particular situation and the following best steps to take during a free initial case review. An experienced Chapter 7 bankruptcy can guide you through the filing process in a way to eliminate or greatly reduce any non exempt assets you own.
Bankruptcy Chapter 7 Michigan Basics
Filing Bankruptcy Chapter 7 in Michigan allows those in serious debt to get their qualified debt “discharged”. To qualify for a Chapter 7 a debtor must meet certain asset and income requirements.
“Discharged” debt is not eliminated, but instead, the debtor is freed of any legal duties to repay the debt. Creditors of debts that are discharged additionally have no legal means of pursuing you for repayment. Not all debts can be discharged. A Chapter 7 Bankruptcy does not cover some debts.
Debt that Cannot Be Discharged in a Michigan Bankruptcy
Certain debts are ineligible for discharge under the Chapter 7 bankruptcy procedure, such as:
- Federal or Federally backed student loans, except in cases of “undue hardship”
- Alimony and child support obligations
- Debts incurred through fraud
- Loans or credit card purchases of $1,150 or more incurred within 60 days of submitting
- Most tax debt
- Criminal fines and penalties
- Debts owed after causing personal injury or death while driving intoxicated
What is the process for filing for Bankruptcy Chapter 7 in Michigan?
A Bankruptcy attorney will gather information from your own regarding your monthly income and expenses to determine if you are eligible for Chapter 7 relief.
The Means Test restricts the amount of certain expenses to IRS guidelines to your family size. When there are Means Test forms accessible on the internet to see if you qualify, many clients don’t understand how to fill them out correctly and consequently, the amount of disposable earnings is inaccurate.
Chapter 7 Bankruptcy Michigan Income Limits and the Michigan Bankruptcy Chapter 7 Means Test
There are Chapter 7 Bankruptcy Michigan income limits that determine your eligibility to qualify for a bankruptcy discharge. Because Chapter 7 Bankruptcy is meant to be employed by people who can’t afford to repay their debt, the U.S. bankruptcy code has generated certain income limits. Before the last changes to the bankruptcy code anyone with any amount of income could file a Chapter 7. Now your family income is very important.
The current code provides a means test that looks at your family income. The bankruptcy court looks at your family income for the past six months and compares that to the average income for your family size. If you make more income then the average income the Code tries to push you into filing a Chapter 13 Bankruptcy and repaying a portion of your debt.
To understand more About your choices for exempting particular assets and secured debts, speak with a Michigan bankruptcy attorney.
Can I keep my house when filing a Michigan Chapter 7 case?
Yes. Like a car you can keep your home after filing bankruptcy. You are allowed $25150.00 in home equity per person titled on the property. If your equity is less than this amount your attorney will exempt out the equity and you will keep your house.
If you have a mortgage, you have the option to reaffirm the home loan. This basically removes the home loan from the bankruptcy. You will keep the original terms of the loan.
Can I keep my car when filing a Michigan Chapter 7 Bankruptcy case?
Yes. When you file bankruptcy you can keep your car. If you do not have a loan on it your attorney will use applicable Michigan exemptions to exclude the value of your car from the bankruptcy estate.
If you have a car loan your attorney can help you obtain a reaffirmation agreement. A reaffirmation agreement allows you to basically pull the car loan out of the bankruptcy. It is like you never filed bankruptcy in the first place.
You should give this some thought, however. If you reaffirm a debt and then fall behind on the payments your creditor can go after you for the debt.
What happens after I file a Chapter 7 Bankruptcy?
After Filing for bankruptcy, clients often wonder when they are going to have good credit again. A consumer credit report stores information about bankruptcy for ten years.
It is often faster to restore your credit by filing bankruptcy than to leave all the bad debt sitting on your credit report where you can nonetheless be subject to lawsuits and garnishments and have a bad debt to income ratio precluding new lenders from providing you with credit.
Residents across southeast Michigan will file their bankruptcy with the U.S. Bankruptcy Court Eastern District of Michigan.
Talk to a Chapter 7 Bankruptcy Michigan Attorney to help you today
Bruce Law Firm offers personalized support, information, and legal representation for many measures of filing Chapter 7 at Michigan. We value the attorney client relationship. We consider the totality of your assets, income, along with other conditions that will help you opt for the most valuable options for your unique circumstance.