Bankruptcy in Saginaw, MI
Are you contemplating bankruptcy or hiring a bankruptcy attorney in Saginaw, Michigan? Are you tired of creditors calling for payments you can’t make? Maybe looking for a way to get out of debt and have you exhausted all other options? Then bankruptcy might be the solution you seek. It is a legal option that can erase a portion or all of your debts.
Types of Bankruptcy in Saginaw, Michigan
Bankruptcy is a legal process that helps individuals and businesses get a fresh financial start. It eliminates a portion of or all of their debts or financial liabilities. In Saginaw, MI to be approved, individuals must prove they have a hardship that prevents them from staying current on their financial obligations. Keep in mind that not all debts qualify. Some liabilities, such as child support arrears, delinquent taxes, alimony, and student loans generally do not qualify for discharge. Consumers who find themselves falling behind in debt can file either Chapter 7, 11 or 13. To determine which option is right for you, you’ll need to assess your goals, assets, and income. You should also consider working with an experienced bankruptcy attorney.
Debt relief and any related concerns fall under the jurisdiction of the U.S. Bankruptcy Court of the Eastern District of Michigan. If Saginaw locals need to attend hearings for their case, the summons may come from this branch of the federal judiciary.
Chapter 7 Bankruptcy
Many people find Chapter 7 to be the right solution for their circumstances because it provides them with the opportunity to start over financially. However, before filing for Chapter 7 bankruptcy, you should thoroughly assess your income and ability to repay what you owe. You should also speak with a bankruptcy attorney in Saginaw who can help you to decide if a liquidation plan is right for you.
Typically, individuals approved for Chapter 7 lack stable income or have experienced a change in circumstances that has resulted in an inability to manage their debts. Though Chapter 7 erases debts, the tradeoff is you may have to give up certain possessions, such as your home, car, or some other assets. However, once you file your petition, an automatic stay goes into effect that requires all collection activity against you like foreclosures and garnishments, to stop temporarily. However, the automatic stay does not prevent all collection attempts. For example, if you owe child support or restitution for a criminal case, you are still liable for those payments.
A Case Opening Tip Sheet details what you need to complete throughout this process. Based on this document, the prerequisites include both credit counseling and means-testing.
For the former, Saginaw residents can find this service from a non-profit like GreenPath. You typically receive this help for free or at a nominal cost from state-approved providers. The certificate that they give you at the end of this process must make its way to the court if you decide to proceed with bankruptcy.
Means-testing is currently under the purview of the Department of Justice and is necessary to qualify for debt relief. The process takes a look at tax data from the IRS and the median income in Saginaw. If you make more than the amount identified by the U.S. Census Bureau, you may not have the option to petition for Chapter 7.
Chapter 11 Bankruptcy
Chapter 11 bankruptcy is more complex than other types of bankruptcy. It is often used by businesses and certain types of people. It allows petitioners to restructure their debts with a reorganization plan, so they are easier to manage over a determined length of time, usually four to 18 months. The main benefit of Chapter 11 bankruptcy is that it does not require petitioners to sell off or liquidate their assets to pay what they owe. It does allow debtors to negotiate with their creditors a reorganization plan that enables them to stay current on their debts moving forward.
According to the U.S. Bankruptcy Court of the Eastern District of Michigan, a voluntary petition and fee are due at filing. Trustees will expect to receive your reorganization plan within 14 days of this event. Along with dozens of other forms Saginaw residents need to complete, the following are examples of the level of effort involved:
- Balance Sheet
- Cash Flow Statement
- Summary of Assets and Liabilities
- Declaration Under Penalty of Perjury
- Equity Security Holders List
Chapter 13 Bankruptcy
Chapter 13 Bankruptcy is a debt restructuring or wage earners plan. In Saginaw, MI after you file, the courts will assign a trustee to examine your liabilities and assets and ability to pay bills. Unlike other types of bankruptcy, Chapter 13 involves you restructuring your debt with a three to a five-year repayment plan. The flexibility of this repayment plan will depend on what property you want to keep and how steady your income is. It may also give you the opportunity to have some or most of your debts discharged.
Requirements and time limits supplied by the U.S. Bankruptcy Court of the Eastern District of Michigan are worth considering. After your initial filing in Saginaw, your repayment plan and other paperwork must reach the court up to 14 days afterward. Creditors have the opportunity to vote on your submission to the court, but the final decision rests with the presiding judge.
The Bankruptcy Process in Saginaw, Michigan
There is never an ideal time to declare bankruptcy. However, if you are unable to pay off what you owe within five years, filing for bankruptcy can help you to lessen the negative impact on your situation and help you get back on track.
In Saginaw to begin the filing process, gather all of your financial records, including monthly expenses, debts, assets, and annual income. This information is crucial to give the courts an accurate picture of your circumstances. Failure to provide all necessary information can result in your petition being denied.
The State of Michigan offers some generous exclusions to consider. Reading the following list will begin to help you decide if this gives you more advantages or less:
- Up to $40,475 in equity for your homestead
- Public benefits like Social Security or workers’ compensation
- Up to $3,725 in equity for one vehicle
- Pensions and retirement accounts
- Up to $2,700 in tools of your trade
At least six months before you file for bankruptcy, eliminate unnecessary spending. Do not run up the balances on your credit accounts. You’ll also need to complete an approved credit counseling course, usually online or over the phone. Credit counseling is necessary to help you learn financial literacy and help you learn better financial habits. Once you complete the course, you’ll receive a certificate of completion to include in your filing. If you don’t have the certificate of completion from the credit counseling course that you took, the courts will reject your bankruptcy petition.
Work With an Experienced Saginaw, Michigan Lawyer
Hiring a local bankruptcy lawyer in Saginaw during this process can help reduce the costly risks of self-representation in court. An experienced bankruptcy lawyer understands state and federal bankruptcy laws. He or she can help you understand which laws apply to your case, especially which debts can be discharged or can’t be discharged. An experienced Michigan attorney can also offer you guidance to improve the outcome of your case.
Keep in mind that there are debt management alternatives and financial resources that may benefit you more than bankruptcy, such as debt consolidation. Though bankruptcy is an attractive solution, it is best as a last resort. Do you need immediate help? Then one of our experienced lawyers in Saginaw can guide you through the entire bankruptcy process. We can even help you connect with an attorney across Michigan state lines.
Submit a request online or call us today at (866) 345-6784 to get in touch with an experienced lawyer in your area!