Real Property: The Michigan Homestead Exemption
The homestead exemption allows you to protect theequity in your home up to a specified amount. Under current state law, you can protect up to $38,225 of equity in your real property. The amount increases to $57,350 if you or one of your dependents is at least 65 or disabled. This is higher than the federal homestead exemption, which allows an individual filer to protect $27,900 in their home.
If the equity in your home is lower than the exempted amount, then you can protect your home. To calculate your equity you subtract your outstanding mortgage loan amount from your home’s current fair market value. So if your home is worth $225,000 and you still owe $190,000 on your mortgage, you have $35,000 in equity. That’s less than the state exemption amount, so your home will be safe.
Experienced Michigan Personal Bankruptcy Lawyers
With offices located in Ypsilanti, Taylor, Jackson and Adrian, our bankruptcy lawyers are able to provide personalized local bankruptcy representation. Since our main focus is bankruptcy, our attorneys keep abreast of any changes in the bankruptcy laws and how they affect our clients.
Our lawyers have handled Chapter 7 bankruptcy cases since 1991. We are committed to helping our clients eliminate their debt and move forward with their lives. We discuss our clients financial situation and determine whether a Chapter 7 bankruptcy is the proper course for their specific situation.
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.
Also Check: Can You File Bankruptcy Without Tax Returns
Filing Chapter 7 Bankruptcy In Michigan
Chapter 7 bankruptcy or straight bankruptcy is a process designed to help consumers start over financially. Chapter 7 discharges unsecured debts such as high-interest credit cards and medical bills. Although the process is organized under federal law, Chapter 7 cases vary by jurisdiction. Each state, as well as the federal government, has enacted exemption laws that dictate the amount of property a debtor can keep through the bankruptcy process. In most cases, exemption laws protect all of the assets of the debtor allowing them to file for bankruptcy and keep all of their property.
In addition to unique exemption laws, each state has different income guidelines for determining whether the debtor is eligible to file for Chapter 7. Thanks to bankruptcy reform in 2005, debtors seeking to file Chapter 7 bankruptcy must demonstrate that they do not have enough disposable income to pay something back to their creditors. If your income over the last 6 months is below the median in your state, you will automatically be eligible to file Chapter 7. If, on the other hand, your income is greater than the state median over the last 6 months for a household of your size, you will need to subject your monthly expenses to the means test.
The means test is a formula that calculates disposable income. If you have too much spoils left over at the end of the month, there is a presumption that you should be filing for Chapter 13 instead of Chapter 7 bankruptcy.
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 debtors 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.
Also Check: How To File Bankruptcy In Mississippi
Protect Your Property By Using The Michigan Chapter 7 Bankruptcy Exemptions You Have Available
A bankruptcy filer will want to talk to a lawyer before they file the case. The Debtor signs a bankruptcy filing. The Debtor swears the items contained in the bankruptcy filing are truthful and accurate. It is not always easy or possible to amend their bankruptcy schedules later in the bankruptcy process.
Can I Keep My House And Car
Yes, it is more likely than not that you will be able to keep your house and car. The bankruptcy code provides for exemptions. These exemptions generally allow people to protect the equity in their home and car. The goal of bankruptcy is to allow people to keep their necessary assets while still getting a fresh start financially.
Recommended Reading: What Happens When You Declare Bankruptcy In Quebec
Your Bankruptcy Options In Michigan
Filing for bankruptcy can be difficult and confusing, but Erwin F. Meiers III, PC Attorney at Law can help navigate you through the complications and lead you to the fresh start you deserve. Every American has the right to seek bankruptcy protection from their creditors. Fred Meiers Attorney at Law can guide you through both the state and federal levels for both Chapter 7 and Chapter 13 bankruptcy.
C Michigan Debt Management
Debt settlement companies negotiate lower amounts. Debt management companies negotiate lower interest rates. This is the key distinction. Often these programs last 3 or 5 years. This option is often more expensive than debt settlement and some creditors such as personal loan lenders may not work with the debt management company. There may be debt management credit score implications as well.
Who may debt management in Michigan best for? Debt management may be best for those that have all high-interest credit card debt, and a reduction from 22-30% interest rate to a 10% interest rate would continue to make the debt affordable.
Firm Awards & Recognition
Board Certified Consumer Bankruptcy Specialist: Awarded by the American Board of Bankruptcy Certification, Board Certified status recognizes an attorney as an expert and a specialist in bankruptcy law. While there are tens of thousands of licensed attorneys in Michigan, only a handful are actually Board Certified in Consumer Bankruptcy Law. Walter Metzen has been a Board Certified Consumer Bankruptcy Specialist since 2005.
10.0 Superb Avvo Rating: Avvo is a recognized source within the legal community both among lawyers and consumers. Each lawyer on the platform is given a rating thats based upon reviews not only from actual consumers, but other lawyers as well, in addition to factors like career achievements, recognition within the industry, and years of experience. Weve proudly achieved and maintain a 10.0 Superb the highest available rating on the platform.
Thomson Reuters as a Michigan SuperLawyer: Recognized as a SuperLawyer every year from 2012 to 2020 as an outstanding consumer bankruptcy attorney who has attained a high-degree of peer recognition and professional achievement.
American Bankruptcy Institute: Contributing member, author, speaker and panelist on consumer bankruptcy-related topics including ethics and the discharge of student loans in bankruptcy cases.
Institute for Continuing Legal Education: Contributing member, author, speaker and panelist on consumer bankruptcy-related topics including handling consumer bankruptcy cases in Michigan.
What Debts Are Discharged In Chapter 7
This chapter of bankruptcy will discharge any unsecured debt unless the code explicitly provides that the debt is not dischargeable. These non-dischargeable debts include: student loans, child and spousal support, and certain taxes and fines.
For more information on the protections available under Chapter 7 Bankruptcy, schedule a FREE CONSULTATION with Detroit Lawyers.
Please contact the office.
Federal Exemptions V Michigan Exemptions Michigan Chapter 7 Bankruptcy Exemptions
There are two options for exemptions in Michigan. In Michigan, a Debtor can use Michigan Exemptions, or the Debtor may use federal exemptions. Some states only allow exemptions from one source or the other.
A Debtor will want to use the exemption scheme that provides the maximum exemption in their unique situation. It is advisable to have a bankruptcy attorney review your assets when considering bankruptcy.
The federal exemptions are usually the most generous and are used in a Michigan bankruptcy case. There are some instances where the Michigan state exemptions may be of more excellent value.
Have A Michigan Bankruptcy Attorney Evaluate Your Chapter 7 Eligibility
The Adler Law Firm PLLC in Detroit, Michigan offers FREE consultations to help people in need decide if bankruptcy is right for them. If youre even considering bankruptcy in or near Detroit, MI, The Adler Law Firm can help show you the various options, such as Chapter 7 bankruptcy and Chapter 13 bankruptcy, and help you navigate the complexities and ramifications of each. We also offer some of the most affordable prices in the Detroit Metro area without compromising on quality. Contact Us today!
Are you interested in a free consultation? At Adler Law Firm, we guarantee a successful Chapter 7 bankruptcy in Michigan or your money back* .
Want to learn more about the bankruptcy process and what you need to file? Get Started.
Read Also: Housing Debt To Income Ratio
What Are The Michigan Bankruptcy Exemptions
5 minute read â¢Upsolve is a nonprofit tool that helps you file bankruptcy for free.Think TurboTax for bankruptcy. Get free education, customer support, and community. Featured in Forbes 4x and funded by institutions like Harvard University so we’ll never ask you for a credit card.Explore our free tool
In a Nutshell
Who Is Eligible For Chapter 7
Eligibility for Chapter 7 bankruptcy is initially governed by a formula known as the Chapter 7 Means Test. The Means Test is a mathematical formula that average the gross income from all household sources other than Social Security from each of the 6 months prior to the month in which the bankruptcy is to be filed. That 6-month household average is then compared to the median income in Michigan for a household of that size. If that average household income is higher than the median, a Chapter 7 may not be possible.
However, the Means Test does allow certain deductions to be made from the Means Test average income in order to reduce a households income back under the median in order to qualify a person for a Chapter 7 who might not otherwise have been.
The Hilla Law Firm, PLLC is experienced in maximizing Chapter 7 eligibility and assisting consumers in passing through the Means Test whenever it is realistically possible and whenever it is in their best interest to be in a Chapter 7. Online means test calculators cannot give an accurate picture of Chapter 7 eligibility no matter what they advertise a determination of true eligibility requires the skill and experience that The Hilla Law Firm offers.
Contact The Hilla Law Firm, PLLC to schedule a free, initial consultation to discuss your Chapter 7 bankruptcy eligibility.
Read Also: Chapter 11 Bankruptcy Court
Am I Eligible To File A Chapter 7 Bankruptcy
In order to qualify for Chapter 7 Bankruptcy, you will be required to take a means test. The test will compare your income and expenses to determine your monthly disposable income. If your disposable income is less than an amount specified by the code, you are eligible. If your disposable income is too high, you may consider filing a Chapter 13 Bankruptcy.
Faqs About Chapter 7 Bankruptcy In Michigan
The struggling economy has brought some unpleasant surprises for a lot of people, and many people are considering filing for bankruptcy that never expected to. Of course, if you find yourself in this situation, you want to make sure pursuing Chapter 7 is worth your time, and that you will not be required to give up anything essential to your life, such as your home or vehicle. As with anything, its important to find out what you can about Chapter 7 before making the decisions whether or not it is right for you. Heres a few questions people often have about Chapter 7 bankruptcy.
Are there any viable alternatives to Chapter 7
For many people there are alternatives to filing Chapter 7 bankruptcy, and for those who can make these alternatives work, it is sometimes the better choice. Bankruptcy attorneys can help not only with filing bankruptcy, but negotiating debt settlements or consolidation with many creditors. Many creditors suddenly become much easier to work with if they hear you are considering Chapter 7, especially if they think that a settlement might be the only way to obtain some type of settlement.
Do I meet income limits for Chapter 7 in Michigan?
What types of debts are included in Chapter 7 Bankruptcy?
Whats not included?
What assets can I keep when filing Chapter 7?
How do I rebuild my credit after chapter 7?
Also Check: Foreclosed Homes Under 100k
Reserve It Or Lose It: Sixth Circuit Bap Reverses Bankruptcy Court On Issue Of Whether Trustee Abandoned Asset In Chapter 7 Case
In a recent decision, the Bankruptcy Appellate Panel of the Sixth Circuit considered the issue of asset abandonment in a Chapter 7 case. The Court reversed the bankruptcy courts decision to allow the Chapter 7 trustee to compromise a claim that the debtor argued the trustee had abandoned.
In re: Wayne L. Wright, Docket No. 16-8019 . Read More
Sixth Circuit Court Of Appeals Finds No Breach Of Contract Or Fcra Violation In Connection With Late Payments Under A Reaffirmation Agreement
In bankruptcy, a debtor must relinquish assets to satisfy debts. But there are exceptions to this general rule. Certain assets may be exempted from a debtors bankruptcy under federal and state law. Other assets, which are subject to a contractual loan agreement and the security interest of a lender, may be reaffirmed by a debtor pursuant to a reaffirmation agreement. The debtor may keep the asset, such as a house or a car, as long as the debtor enters into a new agreement with the lender that reaffirms the debt according to defined contractual terms, which may or may not track the original loan terms.Read More
The United States Bankruptcy Court for the Western District of Michigan recently issued an opinion in a bankruptcy case involving a husband and wife who filed for Chapter 7 bankruptcy protection. Read More
Categories: Chapter 7, Collections
Don’t Miss: When Will Sears File For Bankruptcy
You Do Not Have A Credit Counseling Certificate
In most states, they require you to undergo credit counseling before you can qualify to file for a bankruptcy petition. Credit counseling is an intervention before you file for a bankruptcy case.
Here, the counselor will lay out the different alternatives you can take besides filing for a bankruptcy petition. It assists you in determining whether or not bankruptcy is the best option for your situation.
The counselor will review your financial information, such as your income, assets, expenses, debts. Based on the information you provide, the counselor will recommend a personal budget plan.
If you still believe that filing for bankruptcy is the best option for you, you may proceed, but remember to keep the certificate that the counseling agency will provide you since you will need to show it together with your bankruptcy petition and papers.
Do I Need A Lawyer To File Or Can I File On My Own
You can file on your own. However, the bankruptcy process can be a daunting task to take on by yourself. The bankruptcy code is filled with rules and procedures which must be followed. Without the guidance of an attorney, you may make any number of harmful mistakes which could lead to loss of property or even your case being dismissed.
Recommended Reading: Why Is It Bad To File Bankruptcy
How Can Filing For Chapter 7 Help Me
- As soon as we file for bankruptcy something called an “automatic stay” is put into effect. This means that no creditor is allowed to contact you anymore. Finally, the annoying and harassing phone calls will stop. Also, creditors cant sue you or garnish any of your wages. The automatic stay is put into effect automatically once we file.
- Chapter 7 completely gets rid of your credit card debt, medical bills, utility bills, civil judgments, and any other unsecured debt you have.
- Chapter 7 can stop utility shut offs automatically.
- If you want to keep your car you may be able to negotiate better payment plan.
- If a creditor has garnished more than $600 from you within 90 days of filing the bankruptcy, you can usually get that money back.
- You can finally have a fresh start and this hard time will be a distant memory for you!
After Filing Bankruptcy Do I Need To Keep Paying My House And Vehicle Payments
If you want to keep your house and vehicle after filing bankruptcy then you should continue to make monthly payments. Be careful, creditors may stop sending you statements or discontinue your online access out of concern for violating the automatic stay. It will be up to you to mail your house or car payment monthly. These installment payments are a great way to start rebuilding your so make sure the payments are on time.
Recommended Reading: Pallets Of Goods For Sale