What Are The Downsides To Filing Chapter 7 Bankruptcy
Chapter 7 bankruptcy helps some debtors clear out old debts to start fresh, but it isn’t a perfect solution to every person’s debt problems. First, the debtor must meet certain income guidelines to file this type of bankruptcy case, and even if she does qualify, it may not be in her best interests to use Chapter 7.
Take Credit Counseling Course
You have to take two mandatory credit counseling courses to complete your Chapter 7 bankruptcy. The Chapter 7 trustee may request the certificate of completion in the meeting of creditors. The first course is a pre-bankruptcy course, and the second is the pre-discharge course.
If you are filing with an attorney, your attorney may have suggestions for both the credit counseling and debt education course. If not, you can see the list of approved credit counseling courses in Michigan.
Anyone Can File There Own Bankruptcy
Yes, you can successfully file for bankruptcy without an attorney. However, it may still be worth it to hire a qualified attorney in a simple Chapter 7 bankruptcy filing, since you still need to spend a great deal of time researching bankruptcy laws, deciding how they apply to you, gather your financial information, and attend court. An attorney can easily and quickly guide you through this entire process, answering your questions when needed, and guaranteeing that your debts get successfully discharged . An attorney will also make certain you will not need to declare bankruptcy again by providing you with specific guidance before, during, and after you file.
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Indiana Bankruptcy Means Test
The Indiana means test for bankruptcy first looks at your household income in the 6 months before your bankruptcy is filed. If your average annual income based on that timeframe is less than the median income for a household of your size in Indiana, you qualify for Chapter 7 relief. If your income is greater than that, the means test calculation allows you to take certain deductions based on your living expenses which may make you eligible to file Chapter 7 bankruptcy in Indiana even though you technically Ã¢â¬ÅfailedÃ¢â¬ï¿½ the first part of the means test.
Data on Median income levels for Indiana
Indiana Median Income Standards for Means Test for Cases Filed On or After May 1, 2021
Will I Be Required To Appear In The Bankruptcy Court
Typically, those who file under Chapter 7 will only need to appear in court once.One to two weeks after filing your petition, a “creditors meeting” will be scheduled. During this court visit, you and your lawyer will meet with the bankruptcy trustee who has been assigned to your case and/or any of your creditors who wish to attend. The bankruptcy trustee will then question you about why you are filing for bankruptcy, whether or not you have listed the accurate values of all property that is included in the petition, whether or not you have transferred money to relatives or friends before filing, etc. Since they are acting on behalf of your creditors, they will want to ensure that your debts are repaid in the fullest amount possible.
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Why You Should Come Talk To Us
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Bankruptcy is not a decision to be made lightly. Ive oversimplified the process so far to give you an idea of where to start and where to go for more information. Making a mistake on your bankruptcy schedules, petition, and forms could be far worse than your current financial situation.
Dont risk it. Come in for a free consultation so that you can learn what to do/not to do before during and after bankruptcy. Well explain how the whole process works and help you decide if bankruptcy is the right choice for you.
Whatever you do, please dont avoid talking to an attorney because you think you cant afford it. We offer free consultation as well as easy payment plans. You also may be surprised to hear that we often recover funds for our clients that have recently been garnished from their paycheck or bank account.
How Much Does Bankruptcy Cost In Michigan
It costs $338 to file for Chapter 7 bankruptcy and $313 to file under Chapter 13. The filing fees are the same if you are using a lawyer or are filing for yourself . If you cannot afford the fee you can ask to pay in installments over 120 days or seek a fee waiver if your household income is less than 150% of the poverty line.
Everyone’s bankruptcy case is different, making it difficult to put an average price on the cost of a Michigan bankruptcy lawyer. Sometimes, attorneys will offer to file very simple Chapter 7 cases for as little as $500, but that is usually for individuals with few assets. Most Michigan attorneys charge between $1,000 and $3,500 for a Chapter 7 bankruptcy, depending on your case’s complexity. Since Chapter 13 cases are usually more complex, an attorney will usually run between $2,500 and $6,000.
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Where Do I File For Bankruptcy
Most people file for bankruptcy in the federal district court closest to where they live. However, if you run a business in a different district and most of your property is located there, you may have to file in that location.
Also, if you’ve moved in the past six months , you may have to file in the federal district court where you used to live. It all depends on where the greater portion of your property has been for most of the past 180 days.
Wherever you’re required to file, know that you can handle most of your business with the court, including filing your bankruptcy forms, by mail. However, you will need to visit the courthouse in person at least once, for a meeting with the bankruptcy trustee.
For more details, and to find your local court, see our articles on How to File for Bankruptcy.
Helping You Resolve Your Debt Problems
Heavy debt can put you and your family in financial bondage. It brings with it the pressure of collection agencies and harassing phone calls that warn of foreclosures and repossessions that fill you with anxiety. If you and your family are drowning in debt, Phoenix Law is here to help you get back on your feet. We help people like you who have fallen on hard times due to family illness, job loss, reduced work hours, or divorce to regain control of their financial situation.
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Figuring Out If Youre Eligible For Chapter 13
You may qualify for Chapter 13 bankruptcy if you have a steady income and your debts are worth less than the dollar amounts set by federal bankruptcy law. In 2019, the amounts are:
- $1,257,850 of secured debt.
These amounts are adjusted every few years and set out in 11 U.S. Code, Section 109.
In addition, to qualify for Chapter 13, you must have filed your state and federal income tax returns for the past four years.
Alternatives For Paying The Filing Fee Upfront
Sometimes it can be tough to come up with the money upfront for a bankruptcy filing. This is true, particularly if you are deep in debt and feel like all hope has been lost. Fortunately, there may be options available if you find yourself unable to pay this initial charge before your proceedings begin!
If you can pay your fees over time you may be able to enter into an installment payment plan for you filing fee. On other occasions the bankruptcy court can waive the filing fee. Either of these alternatives require your attorney to file a motion with the bankruptcy court. A bankruptcy judge will decide if either an installment plan or fee waiver is appropriate for the Debtor.
Your lawyer will want to consult with the local rules for how these motions are to be filed. These options may work best for you and provide a fresh start starting today rather than waiting until tomorrow when things could get worse!
Bankruptcy Is A Right And A Privilege
The bankruptcy laws are there for a reason. On the whole, they benefit both the debtors and creditors. It is of course important to be responsible for the debts you incur, but filing a bankruptcy IS an act of responsibility. It puts you in a position to move forward, to become productive once again, provides closure, and pays your creditors from your non-exempt assets .
It is important to seriously explore bankruptcy as an alternative to struggling for years to no avail. There are many factors to consider before filing a bankruptcy, but one of them should not be a guilty conscience.
Warning Signs. In assessing whether or not you should seek some kind of debt relief, consider the following questions:
Do you ever use one form of credit, such as a credit card or debt consolidation loan, to make payments on other debt? Or to put it in Biblical terms Robbing Peter to Pay Peter?
Have you taken one or more cash advances greater than $500 in the past few months to pay living expenses such as everyday utility bills or even groceries?
Do you ever borrow from friends or family to meet regular expenses, such as food and utility bills?
Can you barely make the minimum required payment on credit cards or other debts?
Are you receiving harassing calls or letters from creditors or collection agencies?
Are you being sued , or are your creditors threatening to sue you?
Are your wages being garnished, or are your creditors threatening a garnishment?
Are you behind on house or auto payments?
Who Can File For Bankruptcy
It is certainly possible to file for Chapter 7 bankruptcy or Chapter 13 bankruptcy without an attorney. After all, there is no legal obligation for you to have one to file bankruptcy. But you should probably only file without an attorney if your filing a simple Chapter 7 case, as well explain below. In this article, well outline the steps you can take to file for bankruptcy without an attorney. Well also explain exactly how an attorney can help you throughout the bankruptcy process and whether it makes sense for you to file with or without one based on your situation.
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Chapter 13 Bankruptcy Filing Fee: $313
To file for Chapter 13 bankruptcy, you will need a $310 filing fee. In many instances, it is possible to avoid paying all filing fees up-front and instead make payments directly to the Court monthly. The $310 Chapter 13 Bankruptcy filing fee is broken down as follows:
Chapter 13 Total Filing Fees: $313
$310 Initial filing fee
It costs $235 to reopen a Chapter 13 Bankruptcy filing in Michigan.
Who Cannot File For Chapter 7
Filing for Chapter 7 bankruptcy is one way to solve debt problems, but it isnt available to everyone. Here are some situations in which you might not be able to use Chapter 7 to discharge debt.
You Can Afford a Chapter 13 Repayment Plan
Under the bankruptcy rules, filers with higher incomes must pay back some of their debts over time under Chapter 13 rather than liquidating their debts outright in Chapter 7. If the U.S. Trustee decides that your income, debts, and expenses indicate that you can afford a Chapter 13 plan under the rules, it will file a motion to have your case dismissed. The court is likely to grant that motion and throw out your case unless you convert to a Chapter 13 bankruptcy.
To figure out whether you can discharge debt in Chapter 7, you must first:
- determine your current monthly income
- multiply your current monthly income by 12, and
- compare that figure to the yearly median family income in your state for the same size household.
If your current monthly income is no more than the states yearly median income, your Chapter 7 bankruptcy wont be presumed to be an abuse of the bankruptcy process. However, if your actual income shown in Schedule I of your bankruptcy papers is significantly higher than your expenses you might still be forced into Chapter 13 .
You Have Marijuana Assets
Determine Your Current Monthly and Yearly Income
Use the Current Monthly and Yearly Household Income Worksheet , to calculate your household income by:
What to Do Next
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Michigan Bankruptcy Exemptions And Law
If you live in Michigan and have gotten in over your head with debt, bankruptcy may be an option that gives you some breathing room while you pay down or eliminate your debt. Many people view bankruptcy as a last resort, but if you have no hope for paying off your bills, it is often the only real option for avoiding financial ruin.
How Much Does It Cost To File For Bankruptcy In Michigan
In 2021, Chapter 7 bankruptcy costs $338 in filing fees, unless you get a fee waiver from the court. And the filing fees for Chapter 13 are $313. But the cost of filing for bankruptcy is more than just the filing fee. You may also have to pay for:
When all is said and done, your bankruptcy case could cost you as much as $2,500 and as little as nothing at all. The total cost will depend on:
- whether you qualify for fee waivers
- whether you qualify for free legal aid services
- whether you handle the form preparation and filing yourself or pay someone to help you, and
- how complicated your financial situation isfor example, whether you’re facing imminent foreclosure, whether your debts involve child support or back taxes, and whether you have valuable assets that are not fully protected by an exemption.
Heres an overview of some of the costs that may come up during bankruptcy.
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How Trustees Can Increase The Size Of The Bankruptcy Estate
The whole point of bankruptcy is to make sure that everyone gets their rightful share of the “pie” when there’s not enough pie to go around. Or to put it an more legal way: to provide an orderly distribution of available assets to all creditors, based on the priority outlined in federal bankruptcy law.
The job of the trustee is to make that “pie” as large as legally possible.
Practical And Effective Debt Relief In Michigan
Everywhere you look, it seems like smooth-talking salespeople are hawking quick fixes to your financial difficulties. While you may be presented with many options, a DebtStoppers bankruptcy plan is the only solution that provides comprehensive debt relief. In Michigan, your bankruptcy options are Chapters 7 and 13.
Chapter 7 is a fast and easy way to eliminate unsecured debts like credit cards and unpaid medical bills. While the law permits a bankruptcy trustee to order the sale of your assets to pay back creditors, the majority of DebtStoppers clients keep most, if not all, of their belongings.
Instead of wiping out your debts, filing for Chapter 13 bankruptcy in Michigan allows you to set up a 3-to-5-year repayment plan. Under this plan, you’ll make one reasonable monthly payment to a court-appointed trustee, and you’ll get to keep all your possessions as long as you stick to the schedule.
Michigan Bankruptcy Lawyer Cost
With Michiganâs bustling bankruptcy practice you can find quite a few attorneys who specialize entirely in bankruptcy law. It is common practice in Michigan for bankruptcy attorneys to offer a free initial consultation. Generally, at the end of that initial consultation the attorney you meet with will discuss their costs for filing your Chapter 7 in Michigan. The cost of a Michigan bankruptcy lawyer for Chapter 7 starts around $1,000 and can go up higher depending on the complexity of your case. You can find out more specifics about attorney fees in Michigan.
Attorney Cost Estimate: $1,100 â $1,250.
Youll Meet Income Qualifications If You Pass The Means Test The First Step Is Determining Whether Your Household Income Is Lower Than The Median Income Of Your State
How to file bankruptcy chapter 7 yourself in ny. However, much depends upon the specific details of your case and whether you hold any assets or no. New court decisions come out every day, from bankruptcy courts, federal district courts, bankruptcy appellate panels , federal circuit courts of appeal, and even the u.s. Chapter 7 asset case timeline.
Some of the bills you must pay include a petition filing , court fees and attorney fees . This 21st edition of how to file for chapter 7 bankruptcy also incorporates the many interpretations of the law handed down by the nations bankruptcy courts. A family will often choose to file either chapter 7 or chapter 13 depending on their circumstances, and in most cases, a judge will determine what type of ny bankruptcy they can apply for.
Before you can file chapter 7 bankruptcy in nevada, you have to take a credit counseling course. Application to have the chapter 7 filing fee waived and schedules i and j for the courts approval. The court does not accept cash or personal checks.
How to file chapter 7 bankruptcy in nyc. The net proceeds of the liquidation are then distributed to your creditors with a commission taken by the. In bankruptcy, the means test determines whether you meet the qualification requirements of a particular chapter.
Forms you need to file in chapter 7 bankruptcy. Your case may be dismissed if you do not file the required documents on time. Qualifying for bankruptcy in new yorkmeans testing.
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