Guidance from Trusted Chapter 7 Lawyers

Helping Clients Discharge Their Debts in Michigan Bankruptcy Court

Are you facing overwhelming amounts of debt and worried that you may not be able to pay it off? Are you contending with constant creditor calls, collection attempts, and endless bills? Depending upon your financial situation, you may be a suitable candidate to consider filing for Chapter 7 bankruptcy.

Those who file for Chapter 7 bankruptcy could be granted a fresh financial start, allowing them to breathe more easily and be rid of the constant collection attempts by creditors. Essentially, your remaining debt could be forgiven and wiped clean, giving you a fresh start. As your attorneys, we would evaluate your unique financial circumstances to determine what assets and obligations may be waived if you file for bankruptcy.

Our law firm has proudly served the Detroit metro area for years. We believe in providing uniquely tailored and compassionate legal services to clients throughout the entire process of their bankruptcy cases. When you contact our law office, we will go over your financial options and determine whether you are eligible for Chapter 7 bankruptcy and if this type of bankruptcy is the right choice for you.

To learn more about our legal services and discuss your bankruptcy case in more detail, please contact our Michigan law firm to schedule your free initial consultation today.

What is Chapter 7 Bankruptcy?

Chapter 7 bankruptcy is perhaps the most common type of bankruptcy debt relief under federal law. This type of bankruptcy affords debtors the option to keep certain property, assets, motor vehicles, and finances without fear of losing them to creditors. However, there exists a chance that an additional car or piece of property may not be exempt and could be seized.

Chapter 7 bankruptcy is the legal process to clear your unsecured debts. Most of your unsecured debts will be eliminated within three to six months from the date of your bankruptcy filing.

Chapter 7 is commonly used by individuals who do not have enough money or income to pay back what they owe to creditors and lenders. It pays off the debtor’s unsecured debts through a liquidation of assets to grant the debtor a fresh start financially and allow them to begin rebuilding their credit score.

What Are the Advantages and Disadvantages of Chapter 7 Bankruptcy?

There are both advantages and disadvantages to filing for Chapter 7 bankruptcy. Your Michigan attorneys can help explain the pros and cons of Chapter 7 bankruptcy.

Among the advantages of Chapter 7 bankruptcy is the fact that you will receive a fresh start financially. After the bankruptcy is discharged, the only debts that you will continue to owe money on will be for secured assets. Additionally, you will be granted an automatic stay, which puts a halt to creditor phone calls and further collection attempts. There is no minimum amount of outstanding debt required. After the bankruptcy filing, any income you earn or property you acquire (with the exception of inheritances) shall be yours and not belong to the bankruptcy court or the creditors. In most bankruptcy cases, your case will be resolved in a matter of months.

Despite the many upsides of filing for Chapter 7, there are notable downsides as well. For example, you may lose your non-exempt property, which the bankruptcy trustee will sell. If you wish to keep any secured assets, such as real estate or motor vehicles, and those assets are not covered by Michigan bankruptcy exemptions, Chapter 7 bankruptcy may not be the right option for you. Additionally, Chapter 7 might not be the advisable choice if you have cosigners on a loan. Cosigners of loans could be stuck with your debt unless they also file for bankruptcy protection. If facing foreclosure on your home, the automatic stay granted by filing for Chapter 7 only acts as a temporary defense against home foreclosure. Finally, Chapter 7 bankruptcy will have an impact on your credit score, and you will not be able to file for Chapter 7 again until eight years have passed.

Do You Qualify to File for Chapter 7 Bankruptcy?

You must meet certain criteria to qualify for Chapter 7 bankruptcy in the state of Michigan. Among the key factors for eligibility is your income. Bankruptcy laws will likely implement a means test to determine whether your income level is low enough to qualify for Chapter 7 bankruptcy. The means test compares your average monthly income over the past six months with the median household income of the state. Essentially, if your income falls below the median, you automatically pass the means test.

If your monthly income exceeds the state median, you will need to proceed to additional steps to determine your eligibility. This could include deducting certain expenses and obligations to assess whether you have enough disposable income to repay your debts.

Michigan residents who fail to qualify may have the option of filing for Chapter 13 bankruptcy.

What is Considered Unsecured Debt?

An unsecured debt is a loan that is not backed by an underlying asset, like real estate property or a car.

Examples of unsecured debt include:

Medical bills
Credit card debt
Utility bills
Repossessions
Foreclosures
Personal loans
And some wage garnishments

Your bankruptcy petition will not eliminate certain debts, including the following:

Child support payments
Alimony or spousal support
Compensation for a personal injury you have caused
Student loans
Certain government debts, like unpaid taxes
Some fines and judgments

What is the Chapter 7 Bankruptcy Process?

First, we ask that you schedule your free consultation with our law firm. When you arrive for your consultation, bring all of the requested documents and paperwork. If you decide to file bankruptcy with the help of our legal team, we will inform you of whether there are any associated fees with the filing.

There is a pre-filing credit counseling requirement that must be met. Additionally, certain documentation is required, such as your tax returns from the last two years, pay stubs, and other documents to prove your income from the last six months and any related bills or debt obligations.

Once you have determined that you wish to file Chapter 7 bankruptcy, sign the prepared petitions and receive your bankruptcy case number. From there, our law firm will attend a 341 court hearing on your behalf. You will then be asked to complete the post-filing debtor education course, after which your debts should be discharged.

Do You Require the Legal Guidance of an Experienced Bankruptcy Attorney?

When you are overwhelmed by debt and don’t know what to do, please contact our bankruptcy lawyers to discuss your case in more detail. Bankruptcy could be the solution to all of your problems, but before you file for bankruptcy, we will explore alternatives, such as creating a payment plan and other types of debt relief.

Michigan residents exploring debt relief options are strongly advised to retain professional legal representation from attorneys familiar with consumer bankruptcy law. As your legal counsel, we will help you through the entire process of filing bankruptcy and keep you prepared for any potential conflicts, complexities, or ramifications.

Our law firm offers free consultations to prospective new clients interested in retaining our legal services. Please schedule your free, no-obligation case evaluation today.

Schedule a Free Consultation with Michigan Chapter 7 Attorneys Today

It’s always advisable to seek professional legal counsel when contending with such important matters as your personal assets, property, financial situation, and the question of whether you should file for bankruptcy. An experienced Michigan bankruptcy attorney can provide invaluable legal assistance to you and other interested parties throughout the bankruptcy process.

Sigal Law Firm has extensive experience representing clients interests in complex cases involving bankruptcy law. Just as every client is unique, so too is every bankruptcy case. We will approach your case with compassion and competence, putting your needs first throughout the entire process.

Please contact our Michigan law office at 248-671-6794.