Claiming Bankruptcy in Michigan

Detroit Chapter 7 and Chapter 13 Consumer Bankruptcy Filings

Claimin Bankruptcy in Michigan: The Process

 

Claiming Bankruptcy in Michigan begins with Article I, Section 8, of the United States Constitution which authorizes Congress to enact "uniform Laws on the subject of Bankruptcies." Under this grant of authority, Congress enacted the "Bankruptcy Code" in 1978. The Bankruptcy Code, which is codified as title 11 of the United States Code, has been amended several times since its enactment. It is the uniform federal law that governs all bankruptcy cases including claiming Bankruptcy in Michigan.

The procedural aspects of the bankruptcy process are governed by the Federal Rules of Bankruptcy Procedure (often called the "Bankruptcy Rules") and local rules of each bankruptcy court including the Michigan Bankruptcy Court. The Bankruptcy Rules contain a set of official forms for use in bankruptcy cases. The Bankruptcy Code and Bankruptcy Rules (and local rules) set forth the formal legal procedures for dealing with the debt problems of individuals and businesses.

A debtor's involvement with the bankruptcy judge is usually very limited. A typical chapter 7 debtor after filing Chapter 7 Bankruptcy in Michigan will not appear in court and will not see the bankruptcy judge unless an objection is raised in the case. A chapter 13 debtor may only have to appear before the bankruptcy judge at a plan confirmation hearing. Usually, the only formal proceeding at which a debtor must appear is the meeting of creditors, which is usually held at the offices of the U.S. trustee. This meeting is informally called a "341 meeting" because section 341 of the Bankruptcy Code requires that the debtor attend this meeting so that creditors can question the debtor about debts and property.

A fundamental goal of the federal bankruptcy laws enacted by Congress is to give debtors a financial "fresh start" from burdensome debts. The Supreme Court made this point about the purpose of the bankruptcy law in a 1934 decision:

[I]t gives to the honest but unfortunate debtor…a new opportunity in life and a clear field for future effort, unhampered by the pressure and discouragement of preexisting debt.

Six basic types of bankruptcy cases are provided for under the Bankruptcy Code, my office handles Chapter 7 and Chapter 13 Consumer Bankruptcy cases in Michigan. The cases are traditionally given the names of the chapters that describe them.  If you would like a free Michigan Bankruptcy Case Evaluation. Contact my office for a Fresh Start with Bankruptcy.

Bankruptcy Basics - For Cases Filed on or after October 17, 2005 (pdf)
Bankruptcy Basics - For Cases Filed before October 17, 2005 (pdf)

There are 2 basic types of bankruptcy cases for consumers that are provided for under the Bankruptcy Code, my office handles Chapter 7 and Chapter 13 Consumer Bankruptcy cases in Michigan. The cases are traditionally given the names of the chapters that describe them.  If you would like a free Michigan Bankruptcy Case Evaluation. Contact my office for a Fresh Start with Bankruptcy.

Bankruptcy Basics - For Cases Filed on or after October 17, 2005 (pdf)
Bankruptcy Basics - For Cases Filed before October 17, 2005 (pdf)


   

Why should you hire a Board Certified Bankruptcy Specialist? For over 15 years, I have been helping Michigan residents through the bankruptcy process. My practice is focused on handling only consumer bankruptcy matters, and only in Michigan. My office has handled over 10,000 bankruptcy cases in Michigan and will apply this experience to your case as well. My office prides itself on fast, detailed, personal service. There are many different aspects to a bankruptcy case. Some of the different aspects are listed on the links below for you to explore. If you have any questions while exploring this site or would like a free Michigan Personal Bankruptcy consultation, contact my office at (313) 962-4656 or toll free 888-777-FILE.

I am thoroughly committed to protecting my clients’ rights and providing them with a shield to stop creditor abuse. Many families and individuals have entrusted their personal bankruptcy cases to me, allowing me to help them address and dismiss the stress that financial problems may cause. As a Board Certified Specialist in consumer bankruptcy from the American Board of Certification, I pride myself on the high level of expertise I possess. This expertise always results in savings that vastly outweigh the amount of money spent on legal fees and in a bankruptcy case.

Contact me, Detroit bankruptcy lawyer Walter Metzen today to schedule your free initial consultation. Declaring Bankruptcy in Michigan can be a difficult process and you need the help of a Michigan Bankruptcy Attorney Board Certified. I also offer clients flexible appointment times and same day appointments if necessary. Walter Metzen is a Board Certified Michigan Bankruptcy Lawyer Get in touch with me today to learn how filing bankruptcy may be beneficial for you and your family. Why should you hire a Board Certified Bankruptcy Specialist? Click Here

Claiming Bankruptcy in Michigan

Certain basic concepts apply under both Chapter 7 and Chapter 13. The case is commenced by filing a petition with the bankruptcy court. The petition must list all of your assets, liabilities and other information required under the code. You cannot pick and choose which creditors to include on the petition, but that doesn't mean you cannot keep your home or vehicle, as will be explained later. All creditors must be listed. You may file as an individual or as husband and wife. Married couples do not have to file together if substantially all debts are solely in one spouse's name.
Your creditors can force you into bankruptcy. This is called an involuntary proceeding. For the most part, involuntary proceedings are confined to business cases. Almost all consumer cases are filed voluntarily. Approximately 75% of the cases I file a Chapter 7 "wipe-out debt" cases, the other 25% are Chapter 13 "reorganization or repayment plans" in which the debtor (or husband and wife) make payments to a Chapter 13 Trustee for a 3 to 5 year time period. Most Chapter 13 cases I file are for debtors who are trying to prevent a foreclosure of their home or repossession of their vehicle.  Some Chapter 13 cases are filed because the debtor's are not eligible to file a Chapter 7 either because they have filed a prior Chapter 7 in the previous six year or they have too many assets or make too much money or because they could pay their creditors a good percentage of what they owe with a Chapter 13 plan without too much of a burden on their way of life. Some clients will file a Chapter 13 repayment plan even if they qualify for a Chapter 7 just because they want to pay their creditors. Both Chapter 7 and Chapter 13 will stop creditor action such as a foreclosure or sheriff's sale, utility shut-off, vehicle repossession or wage garnishment. See below or link to my detailed frequently asked questions page for answers to more of your questions.  Feel free to e-mail me, come in to see me for a free consultation or call me locally at (313) 962-4656 or toll free at 888-Debt Gone or 888-4Walter. Walter Metzen is a Board Certified Michigan Bankruptcy Lawyer

The filing of the petition invokes what is known as the automatic stay. This means that your creditors are immediately prevented from doing anything further to compel collection of a debt. The harassing calls, garnishments, law suits, foreclosures, repossessions or shutting off of utility services are all stopped. The "stay" is designed to give you time to sort out your affairs free from the harassment of creditors.

In the petition, your debts are classified as either priority, secured or unsecured. Each is treated differently depending on which chapter is filed. Priority debts in consumer cases are usually limited to government tax liabilities and support obligations. Priority creditors have certain rights to payment over other creditors.

Secured debts are backed by property known as collateral, and typically consist of auto loans and mortgages. The creditor has a lien, or right to recover the property upon default. In most cases, liens attach to property by virtue of a written security agreement signed when the pledged property is purchased, or upon obtaining a loan.

Unsecured debts are almost everything else. They include credit cards, back utilities, medical bills, store charges and unsecured loans. Unsecured creditors do not have a lien or interest in your property. If you purchased certain property with a store charge or credit card, the seller cannot repossess that property on your default without a security agreement.

 

   

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