Bankruptcy in Michigan.
Bankruptcy offers individuals a unique opportunity to restructure or even eliminate their debts. Bankruptcy laws are a very complex, but with the right knowledge it can be a very easy process. Below are 5 things everyone considering bankruptcy should know.
1. What types of bankruptcy are available?
Individuals generally fall into two types of bankruptcy. Chapter 7 and Chapter 13. Chapter 7 is a straight liquidation. It is generally reserved for individuals who lack the financial ability to repay their debts. The goal of a Chapter 7 Bankruptcy is to have the debtor’s unsecured debts eliminated.
A Chapter 13 Bankruptcy is debt repayment plan. In a Chapter 13 Bankruptcy, the debtor repays a percentage or all of their debts through a structured repayment plan overseen by the Court. Through the repayment plan, the debtor repays his or her debts over a period of time not exceeding 5 years
2. You Must Be Honest with the Bankruptcy Court.
Telling the truth and being completely honest is vital in bankruptcy. Courts have refused to assist untruthful and dishonest debtors. You must list all of your assets and all of your debts on your Bankruptcy Petition. You must also answer the Trustee’s questions honestly.
3. Filing a Bankruptcy Is Complicated.
The advice you get from an experienced bankruptcy attorney is priceless. The rules governing bankruptcy are very intricate and rigid. There is little room for error. Worse, the consequences of a misstep can be catastrophic. It is important that you understand the mechanics of the bankruptcy process and all of the variables that have a dramatic impact on the success of your case. To do so, you should have an attorney.
4. Timing is Crucial.
Bankruptcy can be very complicated. It has dozens of moving parts. Things such as your taxes, debts, creditors, judgments, life insurance policies, 401(k)’s, foreclosures, and repossessions can all have an impact on when you should file a bankruptcy. Even starting a new job or adding an addition to the family can dramatically alter your bankruptcy case. The best time to file your bankruptcy depends on your specific situation and goals. It is important to have a qualified attorney guide you through this process.
5. The Effect of the Discharge.
The goal of most bankruptcies is to have your debts discharged, or forgiven. The discharge you receive from the Court eliminates your obligation to pay your debts. It also prohibits your creditors from attempting to collect the debts from you. While the discharge relieves your personal obligation to pay the debt, it does not necessarily eliminate the debt. Meaning, it will not stop a secured creditor from repossessing a car or foreclosing on a house. It also does not eliminate the debt of a co-signor. It simply eliminates your personal obligation to pay.
Bankruptcy Attorneys in Phoenix
Atlas Law, PLC is here to help. Our attorneys are experienced in helping individuals and families with the bankruptcy process. Our Michigan lawyers serve all of Metro Detroit and Ann Arbor, including Plymouth, Northville, Novi, Farmington, Farmington Hills and all of Oakland County.
About the Author: Aaron Shahan is the founder of Atlas Law, PLC. Aaron dedicates his practice to virtually all aspects of estate planning, elder law and probate.