Filing For Bankruptcy In Michigan – What To Expect
While certainly not a blanket cure for all financial difficulties, bankruptcy is sometimes unavoidable and can be the best choice in some situations. Those considering bankruptcy in Michigan likely want to know more about how to qualify and what goes into this often complicated process. Here are some facts everyone should know.
Some people may think that bankruptcy is a way to erase all debts, but that is simply not true. In Michigan, some debts will remain afterward, including taxes, criminal and traffic fines, back child support, most student loans and anything not specifically on the list of debts to be discharged.
Also, credit counseling is mandated by state law before filing for bankruptcy. Debtors must either contact creditors to obtain a workable payment plan or seek a debt consolidation loan within six months prior to filing. After the documents are filed, completing a financial management course is also required.
There are two different types of bankruptcy – chapter 7, the discharging of debt while keeping a home or property not in default, and Chapter 13, a repayment plan that usually allows the debtor to keep a home, automobile and certain other property even though the loans for such properties are in default.
The paperwork required for a Michigan bankruptcy filing is fairly extensive, including a two page petition and a list of all the debts to be discharged and property to be excluded. Deeds or titles of property owned and verification of income, expenses and financial transactions for two years prior to filing are also required. Filing for Chapter 7 is $299, while Chapter 13 is $274.
Many people will be happy to know that once the paperwork is filed, harassing calls from creditors can be stopped. Creditors are required by law to cease contact once advised of the bankruptcy, but the court may not let them know for a number of weeks. To speed along this process, debtors should let creditors know of the filing right away and give them a case number.
The proceeding itself consists of a short meeting (called a 341 meeting) with a bankruptcy trustee. This individual may ask some questions in regards to financial status to clarify matters. The debtor is sworn under oath to answer. The debtors’ attorney and creditors can also attend this meeting.
Many will be relieved to know that bankruptcies don’t end up in court unless a debt or its discharge is disputed. Creditors have 60 days after the 341 meeting to challenge any debts included. If the bankruptcy is uncontested, the process is usually finalized in three to six months.
As filing bankruptcy in Michigan is a complicated process requiring many steps, it’s generally best for people thinking about debt relief in this manner to seek further assistance from a local attorney that specializes in bankruptcies. The right attorney can be an invaluable resource, protecting your property and your interests to the full extent of the law during an often difficult time.
If you need debt relief in the Detroit area, contact Michigan bankruptcy attorney A Better Way Bankruptcy. With nearly three decades of collective experience, their friendly, helpful and compassionate attorneys and professionals can help you obtain relief from debts, stop calls from creditors and get a fresh start. Powered by SEO 2.0 Services
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