Detroit Michigan Bankruptcy Lawyers

8884Walter@sbcglobal.net

Bankruptcy Lawyer Walter Metzen Specializing in personal bankruptcy filings in Detroit and all of Michigan. Call to speak to me directly at 313-962-4656 or 888-4Walter or 888-777-FILE spirtofdetroit

Board Certified Consumer Bankruptcy Specialist

The law office of Walter Metzen Bankruptcy lawyers practice primarily in consumer bankruptcy, including Chapter 7, 11 and 13 (reorganization). Walter has created this site to provide information about filing bankruptcy in Detroit and what it could mean to you. Get creditors off your back and start your life new by filing for bankruptcy. It could mean a whole new start for you and your family.

In times when consumer debt is at an all time high, even the affluent can be confronted by overwhelming debt as a result of a loss of a job, death of a family member, or severe illness. Filing bankruptcy will immediately get the creditors off your back. With Chapter 7, most debts are able to be discharged. In Chapter 13, a payment plan can be established. Either way, your financial situation will be greatly improved.

We are a Debt Relief Agency helping people file for bankruptcy relief under the Bankruptcy Code. Let us help you decide if bankruptcy is right for you.

Attorney Walter Metzen is here to help you. With our extensive experience in bankruptcy, we know this complicated law well. Our Attorneys have included information on this site to help you decide if bankruptcy is right for you as well as exactly what bankruptcy is. If you have any questions, don't hesitate to call us for a free consultation.

About Bankruptcy - Chapter 7 and Chapter 13

Bankruptcy is a legal method of eliminating debt and providing a means for debt-oppressed people to obtain a "fresh start." In many cases, bankruptcy means the elimination of the debt that you owe to your creditors. They are two primary forms of bankruptcy, Chapter 7 and Chapter 13.

Warning Signs. In assessing whether or not you should seek some kind of debt relief, consider the following questions:

Do you ever use one form of credit, such as a credit card or debt consolidation loan, to make payments on other debt? Or to put it in Biblical terms "Robbing Peter to Pay Paul"?
Have you taken one or more cash advances greater than $500 in the past few months to pay living expenses such as everyday utility bills or even groceries?
Do you ever borrow from friends or family to meet regular expenses, such as food and utility bills?
Can you barely make the minimum required payment on credit cards or other debts?
Are you receiving harassing calls or letters from creditors or collection agencies?
Are you being sued (summons and complaint), or are your creditors threatening to sue you?
Are your wages being garnished, or are your creditors threatening a garnishment?
Are your financial problems impacting your health or relationships due to stress?
Do you owe two months salary or more on your credit cards?
Are you using one-quarter or more of your take-home income to pay credit card bills and personal loans (excluding mortgage payments)?
Are your revolving credit cards charged to the limit or maxed out?
Have you bounced more than one check in the past year?
Are you without cash reserves for a rainy day or emergency?
Are you behind on house (mortgage or rent) or auto payments?
Are your creditors threatening to take your car, house, or other property (foreclosure or repossession)?
Are you behind on your taxes or do you owe the IRS, State of Michigan or City of Detroit?

If you answered “yes” to one or more of the preceding questions, you should consider seeking some form of debt relief. Bankruptcy, of course, offers very effective debt relief, but there are possible alternatives to filing bankruptcy which shall be covered below.

Why is it legal to file bankruptcy?

More so than in any other time in our country's history, our economy is based on consumer debt. In fact, in this age of multibillion dollar corporate bailouts, easy credit and relentless bombarding of seductive messages cajoling us to "charge, consume, buy" it is not surprising that so many people are drowning in debt.

For many of us, this debt is insurmountable and is causing family problems and feelings of hopelessness and even suicide. With credit card interest rates of 18-27%, many feel like modern day indentured servants. Many times, the debt is occasioned by unforeseen events such as loss of a job or medical bills, but more often it is simply poor planning. Nevertheless, in instituting our bankruptcy laws, Congress recognized that responsible, well-intentioned people could from time to time run into financial problems. By allowing you to recover from your debt burden you will be able to start afresh, look to the future and become a more productive member of society. This is good for you and good for society as a whole.

Bankruptcy - An Overview

Even the hardest workers and the most diligent bill-payers can find themselves with more debts than they can pay as they become due. In such cases, filing bankruptcy may provide a solution to what seems like an insurmountable problem. If you or someone you know is facing serious financial challenges, it is very important to seek the counsel of an experienced bankruptcy attorney. Once considered a last resort, bankruptcy has evolved into an accepted method of resolving serious financial problems. The bankruptcy lawyer's goals are to help debtors make a fresh start and ensure that creditors get paid. A skillful attorney can guide you through the complicated legal maze of bankruptcy.

Bankruptcy law is primarily federal in origin and therefore varies little from state to state. The United States Constitution grants to Congress the power to establish uniform bankruptcy laws throughout the United States, which ensures consistency and predictability in how bankruptcy proceedings are conducted. The individual states do, however, retain jurisdiction over certain debtor-creditor issues that are not addressed by and do not conflict with federal bankruptcy law, such as which property remains exempt from creditors' claims.

Commercial and Consumer Bankruptcy

Both businesses and individuals may file for bankruptcy. Commercial bankruptcy is a remedy available to businesses that are unable to pay their debts. Options include liquidation, in which many of the business's assets are sold and the proceeds are divided among the creditors, and reorganization or restructuring, in which the business continues to operate according to a plan that allows for at least partial payment to creditors. Consumer bankruptcy, by contrast, is a method by which individuals may be able to get out from under insurmountable debt and make a fresh start, albeit with a negative impact on their credit ratings. As in commercial bankruptcy, there are two options: liquidating assets to pay off creditors, and filing a wage-earner plan that allows the debtor to retain more assets while working to pay off his or her debts. An experienced bankruptcy attorney can help you choose the right course of action for your particular situation.

Chapter 7 Liquidation

Bankruptcy law provides two basic forms of relief: (1) liquidation, and (2) rehabilitation, also known as reorganization. Most bankruptcies filed in the United States involve liquidation, which is governed by Chapter 7 of the Bankruptcy Code. To qualify for Chapter 7, an individual debtor has to satisfy a financial means test. In a Chapter 7 liquidation case, a bankruptcy "trustee" collects the debtor's "nonexempt" property (as opposed to the property that the debtor is allowed to keep and that is not subject to the creditors' claims) and converts it into cash. The trustee then distributes the resulting funds among the various creditors according to an order of priority described in the Bankruptcy Code. Not all creditors receive the full amount owed through this process; in fact, some may receive no payment at all. When liquidation and distribution are complete, the bankruptcy court may discharge any remaining debts of an individual (non-business) debtor. If the debtor is a corporation, it ceases to exist after liquidation and distribution, and there is therefore no reason for further discharge because the creditors cannot seek payment from an entity that no longer exists.

Chapter 11 or 13 Reorganization

In a rehabilitation or reorganization, the option often preferred by the courts, creditors may be provided with a better opportunity to recoup what they are owed. This type of bankruptcy is governed by Chapter 11 or Chapter 13 of the Bankruptcy Code. Chapter 11 generally applies to individual debtors with excessive or complex debts, or to large commercial entities like corporations. Chapter 13, by contrast, generally applies to individual consumers with smaller debts. Farmers and municipalities may seek reorganization through the Code's special chapters, Chapters 12 and 9, respectively. Reorganization provides debtors with a greater opportunity to retain their assets if they agree to pay off their debts according to a plan approved by the bankruptcy court. If the debtor fails to adhere to the plan, however, the court may still order liquidation.

Whatever the Chapter, the petitioning debtor must first undergo an individual or group briefing regarding credit counseling and budget analysis skills.

"Voluntary" and "Involuntary" Bankruptcies

Most bankruptcy cases are filed by the debtor and are thus considered "voluntary bankruptcies" (although few would "volunteer" to be in this position). Once a bankruptcy petition is filed, the debtor is immediately entitled to relief from creditors through the bankruptcy procedure known as the "automatic stay." The automatic stay freezes all debt-collection activity and forces creditors to allow the bankruptcy court to determine how payment will be made.

Not all bankruptcy proceedings are voluntary, however. Under Chapters 7 and 11, creditors, too, have the option of filing for relief against the debtor, in which case the proceeding is called an "involuntary bankruptcy." Involuntary bankruptcies are allowed only when certain minimum thresholds are met; for instance, there must be a minimum number of creditors and a minimum amount of debt. The debtor has the right to file a response to an involuntary petition, after which the court will determine whether the creditors are actually entitled to relief. If the court dismisses an involuntary bankruptcy filing because it has no merit, the creditors may be ordered to pay the debtor's attorneys' fees, damages for any losses the debtor experienced because of the bankruptcy, and even punitive damages to punish the creditors for the frivolous or abusive filing of a petition. An experienced bankruptcy attorney can provide essential advice whether you are a debtor considering voluntary bankruptcy or facing an involuntary bankruptcy proceeding, or a creditor seeking relief through an involuntary bankruptcy.

Conclusion

Lawyers specializing in bankruptcy law can help both debtors and creditors overcome obstacles to the repayment of debt. Their expertise often extends beyond bankruptcy to include debt repayment and collection options that can circumvent the need for a bankruptcy filing. Experienced bankruptcy attorneys have the knowledge and expertise to help their clients get out from under formidable debt and emerge as productive citizens, and can also assist their creditor clients in collecting what is rightfully theirs.

Walter Metzen-Bankruptcy Lawyer-(313) 962-4656-Suite 3156 Penobscot Building, Detroit Michigan 48226-Serving the Entire Metro Detroit Area and Southeast Michigan for over 10 years

Detroit - Chapter 7 Bankruptcy

Also known as "Fresh Start" or "Straight" bankruptcy, Chapter 7 bankruptcy allows a person to eliminate most or all of his debt while being allowed to keep whatever property he may have.

In many cases, a person may keep their home or car (secured debt), provided that they continue to make current payments and are up to date on the loan.

Chapter 7 eliminates:

Credit Card debts

Medical debts

Personal loan debts

Lawsuit debts

Judgments - Unless fraud or criminal related

Deficiency debts on repossessed autos and foreclosures

Some IRS Debts - many income tax debts are dischargeable.

Personal Injury Debts - except driving while intoxicated and criminal injury.

Chapter 7 is the most commonly filed bankruptcy and can allow for a new start. More and more Americans find themselves struggling with debt they cannot control. Chapter 7 bankruptcy allows for their debt to be discharged and lets them get a hold of their financial situation with a fresh start.

Chapter 7 does not eliminate student loans except extreme hardship cases, debts from certain types of taxes, alimony maintenance or support payments, fines, penalties and criminal restitutions, or debts from personal injuries caused by driving while intoxicated.

Chapter 7 Overview
Chapter 7 is the most common type of bankruptcy, it is sometimes referred to as "liquidation bankruptcy," or "straight bankruptcy." The basic purpose of chapter 7 is to provide you with a fresh start by wiping out all qualifying debts including credit cards, medical bills, repossession deficiencies, law suits as well as a variety of other debts. Bankruptcy lawyers can help with the process. In chapter 7 there is no repayment required for most unsecured debts, your debts are wiped out completely and permanently. In about 99% of chapter 7 cases, the consumer keeps all property, and eliminates most debts. The entire process usually takes less than 4 months to complete. After the bankruptcy is over, the consumer may choose to selectively pay back debts, such as debts to family members, however repayment is not legally required.

The Chapter 7 Process
In chapter 7 the typical consumer only has one meeting with the bankruptcy trustee. The purpose of the meeting is to give creditors a chance to ask questions, although it is very rare that a creditor shows up; it is mostly handled by attorneys. The trustee may also ask you questions about particular items on your petition usually focusing on assets or income. Most meetings take only a few minutes. Some consumers feel some level of anxiety or fear leading up to the meeting with the bankruptcy trustee, but there is no reason to fear the trustee. The trustee is looking for people who are hiding assets or trying to defraud the system, they don't want to harass or scare the common consumer. The meeting will take place in an ordinary conference room, and the trustee is not a judge; the setting is informal. After the meeting, the first thing most people say is "...that's it?...that was easy." Once the meeting with the trustee is done, the only thing left to do is keep your address current with the court, complete a quick financial literacy course (can be done in our office or at home via computer or internet) and wait for your discharge to come in the mail.

When is Chapter 7 appropriate?
Chapter 7 is appropriate for those who cannot afford to pay on their debts. While chapter 13 works well for those who can afford some kind of payment plan, chapter 7 is reserved for those who have no means to pay on their debts. In order to evaluate whether chapter 7 is the correct course of action, the attorney will need to review the person’s budget of income and expenses. If a budget analysis shows no ability to pay, after living needs are considered, then chapter 7 may be the best and only option to discharge debts. Chapter 7 may not be appropriate if there is property at risk, such as a home that is going into foreclosure or a vehicle that may be repossessed if the debtor cannot catch up in time. Chapter 13 is usually the only way to reorganize debts in order to catch up on missed payments for car and home loans. Also under chapter 7 a person is only allowed to keep a certain amount of assets free of the bankruptcy. “Exempt” assets may be retained but if assets exceed what the law allows a person to keep, these assets may be at risk in a chapter 7 case. Chapter 13 may be more appropriate for these individuals. Most cases involve little if any risk of losing assets because a qualified attorney should review what assets and property a person has before advising on what chapter to file. Our policy is to review the case thoroughly before a decision is made to file chapter 7 or chapter 13.

What debts are cancelled in chapter 7?
Most debts are discharged or cancelled in a chapter 7 case. There are exceptions to the broad discharge of debts. Debts for most taxes and student loans are not cancelled. Debts or obligations under a divorce or support decree are not usually cancelled, ind debts due to fraud, dishonesty or misconduct are not cancelled. Bankruptcy relief from debt can be denied to those who attempt to abuse the law to their advantage or are guilty of some kind of misconduct such as destroying, concealing or disposing of their assets or financial records. Criminal charges or sentences are not affected by filing bankruptcy. Unless a debt is excepted from discharge, it will be cancelled or discharged at the conclusion of the case. Most bankruptcy cases are routine as long as they are properly prepared and the client is honest in disclosing all financial information on the schedules. The attorney should guide the client through the process so that the case is presented correctly.

What property is at risk in a chapter 7?
Property usually is not at risk when a qualified attorney advises you to file chapter 7 bankruptcy, but sometimes property can be taken by the bankruptcy official (trustee) and sold to pay on your debts. A person filing bankruptcy is called a debtor. When a debtor files chapter 7, all of the property owned must be disclosed or declared. A debtor is allowed to keep a generous amount of assets under chapter 7 as long as full disclosure is made. Most property in a typical chapter 7 is “exempt” from creditors in the bankruptcy. Exemptions are assets and property that a debtor may keep from the case, but if assets exceed the exemptions, they are risk and may be taken and sold to pay creditors. Only a qualified attorney can give up to date advice on what is exempt and what is not exempt. Preparing in advance for your interview includes filling out forms and listing the value of your assets. The biggest question will usually be “what is your property worth?” Whether your property is exempt may depend on its fair market value. If property has a mortgage, then the value of the asset to the owner is the equity. How much equity in a property will determine whether the property is at risk in chapter 7 bankruptcy. If property is at risk and is needed by the debtor, sometimes it is better to choose chapter 13 since there is little risk of losing assets as long as payments are made under the chapter 13 payment plan. Chapter 13 is also the only way to save a home from foreclosure or a car from being repossessed if the debtor is behind and cannot catch up in time to satisfy the creditor. Chapter 7 does not “reorganize” debts like a chapter 13 plan so under a chapter 7 one needs to stay current on mortgages and car loans in order to retain them, while under chapter 13, a debtor can stretch out the catch up process.

How do I keep paying on my home and car or truck?
If you want to keep your home or vehicle, and have payments due on these items, it is normal to continue paying on these debts after the bankruptcy is filed. However, before the case is “discharged” or closed, you need to sign and file with the court an agreement to reaffirm or reassume these debts. This agreement is called a “reaffirmation.” If no reaffirmation agreement is filed requiring the debtor to keep paying, the debt is cancelled and the creditor may not accept payments on the account and may want to repossess or foreclose on the property. The attorney will work with the debtor and creditor to negotiate and sign the reaffirmation agreement, and there is normally a modest fee for doing so. This is done after the case is filed and must be completed and signed prior to discharge. Some people do not wish to retain their home or car, so they agree to surrender the property and discontinue paying. These debtors who do not wish to keep paying on these debts do not, of course, sign a reaffirmation.

What does it mean to “discharge” debt?
A discharge of debt means that the debt is legally cancelled. Getting a discharge is the reason to file for bankruptcy. Most kinds of debts are discharged in a normal bankruptcy situation so we usually explain the concept by saying that most!debts are cancelled but some are not and we go over what kinds of debts are not discharged. The debts which typically are not cancelled are special kinds of debts, such as child support, alimony, student loans, most income taxes, most student loans and debts relating to fraud, misconduct, intentional injury or crimes. Grounds for denying discharge also include hiding or concealing assets, filing false documents or the loss or destruction of financial records. The typical case does not involve these types of things, but the categories of debts which remain after bankruptcy should be re䁶iewed with a qualified attorney. Also, running up credit just prior to filing bankruptcy is evidence of fraud as is transferring property to friends or relatives hoping to keep them out of the bankruptcy, and this type of behavior should avoided, as should any type of dishonesty or wrongful conduct.

A Chapter 7 bankruptcy is ideal for individuals with enormous unsecured consumer debt, such as credit cards. In a typical Chapter 7 bankruptcy filing, the debtor is allowed to keep important assets such as the home, vehicles, and household contents. However, if the wrong choice is made or the case is not prepared correctly, disastrous consequences may occur. In most instances, the debtor is allowed to keep all of their property. Upon completion of the Chapter 7 bankruptcy filing, most debts are extinguished.

Some people attempt Chapter 7 bankruptcy alone, or with a legal document service. To be sure you are getting the maximum benefit available under the law, you should work with an experienced bankruptcy lawyer.

To better assist our clients, we provide the following services:

· Free initial consultation
· Free credit report with filing
· Free budget analysis and means test analysis
· Low-cost Chapter 7 filings
· Evening appointments

Detroit Michigan - Chapter 13 Bankruptcy

Chapter 13 bankruptcy allows a person to consolidate the debt while making convenient mont䁨ly payments to a trustee. A payment plan is proposed which repays the debt over a three to five year period. The amount of the monthly payment and the length of the repayment plan is based upon the following factors:

Monthly income of the person

Monthly expenses of the person

Amount and nature of the debt

The most common uses of Chapter 13 involve:

Repayment of mortgage arrears (back amounts owed) home

Restructuring of auto loans to save a vehicle

Secured debts are paid 100% on the dollar, while unsecured debts may be paid less than 100% on the dollar. A person receives a discharge under Chapter 13 once the payment plan is completed.

A Chapter 13 bankruptcy, also referred to as a “wage earner” plan, is ideal for individuals with a reliable source of income. Under Chapter 13 of the Bankruptcy Code, wage earners can enter into a payment plan with creditors, whereby they agree to repay debts over an extended period. Most Chapter 13 payment plans last three to five years. A Chapter 13 bankruptcy plan allows you to keep your property as long as you remain in the plan, and make your payments. Chapter 13 is ideal for stopping mortgage foreclosures, car repossessions, interest, and late fees. Most payments are reduced and consolidated in one monthly payment.

How does Chapter 13 work?
Chapter 13 is a payment plan which is frequently called debt consolidation. The payment plan is usually MUCH LESS than what creditors are demanding! We can usually consolidate all debts at a payment that is affordable while protecting your wages and property. The harassment stops, no one can garnish wages, take property, repossess the car or truck, foreclose on the home, etc. But one needs to file a case in order to get the protection. Interest and late fees are often waived under Chapter 13 plans. Many plans provide for a percentage pay-back if the client cannot afford to pay all debts in full. This means that Chapter 13 will often be the best payment plan for you.

How are Chapter 13 payments calculated?
In most Chapter 13 cases the payment is based on your budget....your ability to pay. That is why we need to go over your income from your pay-stubs and your living expenses in detail. Our office is unique in that we have a computer program which calculates your budget of income and expenses while you watch it on the computer monitor. You can see the income and expenses broken down as we type it in, and see just where your money goes each month. This enables us to calculate how much you can afford to pay toward your debts very quickly, while you watch us. You just need to know how much you make on average, and how much you spend on house payments, rent, utilities, insurance, groceries, gasoline, etc. House payments and rent are generally not included in the chapter 13 plan unless you are behind. If your mortgage is past due, a chapter 13 can help catch it up and stop a foreclosure from occurring if the case is filed on time. Car payments are usually included in the chapter 13 plan and the car is paid off as part of the plan. Generally, no one can repossess or seize your car or other property once your chapter 13 is filed. Your wages, earnings, bank accounts, and personal property are protected by the Chapter 13 “automatic stay” against creditors.

What is at risk under Chapter 13?
If one waits too long, the property is lost for good. It is much easier for us to protect what you have than to try to get it back for you once it is seized by a creditor! So it is best to consult quickly. The risk in chapter 13 is waiting too long to do something! Also, the longer one waits, the more interest and late charges are added to balances. Chapter 13 stops interest and late charges on most debts, so prompt action is best.

Chapter 13 is a better option for many who may risk losing assets in a chapter 7 case. Where in chapter 7 a trustee is appointed to look for non-exempt assets to sell in order to pay debts, the chapter 13 trustee receives payments from the debtor and does not liquidate or seize control of any of the debtor’s assets. In this way a person with assets that might be at risk in a chapter 7 would select chapter 13 in order to safeguard all assets. The stipulation would be to maintain the payments provided for by the plan.

Chapter 13 plans are different for different clients. Only a qualified attorney with experience can draft a good plan that works well and meets the needs of the client. While some bankruptcy attorneys have little experience with Chapter 13 plans, we are experienced in this field and have filed thousands of cases in Michigan.

Stopping foreclosure:
Chapter 13 is very useful in order to save a house from foreclosure. The plan will provide for the maintenance of the monthly payment on the house and then pay the lender a little extra each month so that the mortgage is caught up by the end of the plan. Once the plan is completed, the debtor will continue to pay the normal monthly mortgage. In the meantime, foreclosure is stopped while the default is cured over the life of the chapter 13 plan.

Stopping repossession:
Chapter 13 is very useful to stop repossession of cars, trucks, automobiles and other assets that are needed by the debtor. Instead of paying the usual payment and meeting the demands of the lender to catch up missed payments, the chapter 13 plan can pay the loan off over a period of time at a reduced rate when combined with other debts that are owing. No one can take the debtor’s assets, property or vehicles while payments are maintained and the lender is protected by insurance on the property. The debtor is responsible for paying insurance.

Stopping interest, late fees and penalties:
For those who can afford to pay on their debts but are drowning in interest, late fees or penalties, chapter 13 is useful for reducing payment on everything from credit card debts, signature loans, taxes and auto loans to medical bills, lawsuit claims and judgments.

We know that filing bankruptcy is stressful. Accordingly, we emphasize personal service in all our dealing with our clients. We offer many special services to assist our clients, including:

· Free initial consultation
· Free credit report with filing
· Free budget analysis and means test analysis
· Low-cost Chapter 7 and 13 Bankruptcy
· Evening appointments

As with other types of bankruptcy filings, a Chapter 13 bankruptcy proceeding provides debtors with the protection of the automatic stay. Once a Chapter 13 bankruptcy is filed, creditors are prevented from making any further attempts to collect a debt, whether through letters, calls, collection agencies or legal filings.

Is There More Than One Type Of Bankruptcy?
Yes. There are three main types of bankruptcy. The most common is Chapter 7. This used to be called "straight bankruptcy," and is now referred to as a liquidation proceeding. If your income is below the median income of your state, you may qualify for Chapter 7 relief. Even if your income is above the median income in your state, you may still qualify for Chapter 7 if you can show special circumstances. Chapter is 13 is a reorganization proceeding for individuals and small proprietary businesses owners. Chapter 11 is a reorganization proceeding usually filed by larger businesses or individuals with significant assets or debts that exceed one million dollars.

Why Would I File Chapter 7?
Most people file for Chapter 7 relief in order to get a "discharge" of their debts and have a "fresh start" in life. They can no longer afford to repay all their debts due to illness, unemployment, marital problems, unexpected medical expenses, over-extended credit or other large expenses. Not all debts can be discharged, however. For example, obligations to pay alimony, child support, and taxes that are less than 3 years old are non-dischargeable, or debt obtained by fraud.

What Is the Chapter 7 Process?
Chapter 7 is called a liquidation proceeding. Each state has set a limit on how much property a debtor may keep after he or she files for bankruptcy. Some states use the federal exemption laws found in the Bankruptcy Code and others use their own state law. An Interim Trustee is appointed to administer the case. He or she questions the debtor at a meeting of creditors to determine whether the debtor has more property than the law allows. The vast majority of people filing Chapter 7 do not own more property than they are allowed to keep. Those who do own more than the bankruptcy law permits will have to turn over the non-exempt property to the Interim Trustee. The Trustee will then sell the property and use the proceeds to pay the debtor's creditors.

Why Would I File Chapter 13?
Generally, people file Chapter 13 in order to keep property for which a creditor has a lien ("secured creditor"), such as a ho}se or car, or for which payment is in default and the creditor is about to foreclose or repossess. The filing of Chapter 13 bankruptcy will stop the foreclosure sale and allow the debtor 3 to 5 years to repay all the arrears. Some individuals and small business owners file Chapter 13 because they can only afford to repay some, but not all of their debt. Rather than wiping out their debts in a Chapter 7 proceeding, Chapter 13 allows them to "reorganize" and pay a certain percentage of their debt over a period of 3 to 5 years. The unpaid balance is discharged after the payment plan is completed.

What is the Chapter 13 Process?
Chapter 13 is a reorganization proceeding. The Debtor formulates a plan to repay his or her creditors over a period of 3 to 5 years. The Debtor sends a monthly payment to the Chapter 13 Trustee who then distributes the payment to the debtor's creditors. The debtor must appear at a meeting of creditors where the Trustee confirms that the debtor qualifies for Chapter 13, that the debtor can afford to make the proposed plan payments, and that the proposed plan complies with the Bankruptcy Code. The debtor may also need to appear in Court before a Bankruptcy Judge for a confirmation hearing. At the confirmation hearing the Bankruptcy Judge will approve the debtor's plan if it complies with bankruptcy law and the debtor has also fulfilled his or her obligations under the law.

Can Anyone File For Bankruptcy?
In order to qualify to file Chapter 7, the debtor must reside or have a domicile, a place(of business, or property in the United States. The debtor must not have received a bankruptcy discharge within the last 8 years, or had a bankruptcy case dismissed for cause within the last 180 days. For a Chapter 13, the debtor must also have a steady source of income and cannot have secured debts that exceed $922,975.00 and unsecured debts that exceed $307,675.00. All debtors with consumer debts must also receive credit counseling from an approved counseling agency before filing the case.

If I Am Married, Does My Spouse Also Have To File Bankruptcy?
No. However, the spouse that does not file will not get the benefits of bankruptcy. In other words, if the non-filing spouse is jointly liable on certain debts, he or she will remain liable for those debts if the filing spouse filed for Chapter 7, and will remain liable for any amount not paid in the filing spouse's Chapter 13 plan. On the other hand, the non-filing spouse will not have bankruptcy noted on his or her credit report.

Will Bankruptcy Stop A Wage Garnishment?
Yes. Some of the money garnished may be returned. It depends on how much was garnished and when it was garnished. Your attorney will be able to advise you whether to expect any money to be returned to you.

Will Bankruptcy Affect My Job?
No. Bankruptcy law prohibits governmental and private employers from discriminating or taking any adverse action against a debtor because of the bankruptcy filing.

Who Can Help Me File For Bankruptcy?
The best person to help is an attorney who specializes in bankruptcy. That person is the most qualified to analyze your financial situation and determine whether bankruptcy is the appropriate course of action for you, and if it is which type of bankruptcy will meet your needs. The attorney will prepare all the documents needed to file for bankruptcy accurately and completely and will be able to represent you in Court if necessary.

What Documents Will I Need In Order to File Bankruptcy?
Your attorneys will probably ask that you provide them with following documents before you file your case:

* six months of paycheck stubs of other documents regarding your income such as support payments, retirement benefits, rental income, etc. for you and your spouse

* copies fo your tax returns for the last 4 years

* copies of deeds to real property owned by you

* copies of the title to any vehicles you own

* copies of your credit reports

* copies of all your billing statements from your creditors, their collection agencies and attorneys

* copies of any law suits, tax liens, arbitration claims filed by or against you

* copies of all bank statements

· Michigan Debt Aid

· 8884Walter.com

· Michigan Bankruptcy

· Detroit Bankruptcy Lawyer Metzen

· Michigan Bankruptcy Attorney.com

Attorney Walter Metzen, the principal bankruptcy attorney here at Detroit Michigan Bankruptcy Lawyers .com has over 10 years experience in bankruptcy law. All associate attorneys have also successfully assisted thousands of clients with their bankruptcy filings. We maintain close communication with our clients by being readily available in person (walk-in times everyday), by telephone by fax and by email. Detroit Michigan Bankruptcy Lawyers .com's principal bankruptcy attorney Walter Metzen along with his associates have been providing quality legal services for over 10 years. We are not the largest law firm in Detroit; We are not the largest bankruptcy law firm in Michigan, nor do we want to be. What we do have is a dedicated, experienced staff that will provide you with attentive, personalized service. We do not believe that bigger is necessarily better. The attorneys at Detroit Michigan Bankruptcy Lawyers .com strive to know the law and now the Bankruptcy Court system. We study the Bankruptcy Code, the Bankruptcy rules and the Local Bankruptcy Rules for the Eastern District of Michigan. We know the Bankruptcy Judges the Chapter 7 Trustee's and the Chapter 13 Trustee's. We know the other local bankruptcy attorneys. We can guide you through any bankruptcy proceeding. The attorney you speak with is the attorney who will go to Bankruptcy Court with you. We will not send an attorney fresh out of law school. At Detroit Michigan Bankruptcy Lawyers .com, you will not be treated as one more case in a huge bankruptcy factory...but you will be given personal attention and good old fashioned legal services.....where you can talk to your attorney and paralegal when you need to. We have a reputation in the Detroit area for providing our clients with superior service at the lowest possible cost, keeping in mind the client’s needs for honest, and experienced legal knowledge and service, while maintaining the lowest fees possible. Detroit Michigan Bankruptcy Lawyers .com philosophy is to provide the client with honest advice, whether bankruptcy is appropriate for the client or not, and to stand up for our client’s best interests. You can expect us to communicate with you every step of the way, and explain to you all of our recommendations. Our goal is to provide each client with quality legal services and excellent communication at a reasonable fee. We offer free consultations, over the phone, the internet, or in person. Detroit Michigan Bankruptcy Lawyers .com's Office is conveniently located just one-block from the US Bankruptcy Court in Detroit Michigan to better serve you. Because of our close proximity to the Bankruptcy Court, we can file your case the same day if needed to immediately stop foreclosure, car repossession, utility shut off (gas, phone or electric) and stop those creditor calls! We at Detroit Michigan Bankruptcy Lawyers .com are focused on serving our clients. Our professional calling is to our clients and only our clients, on a full-time basis, to the best of our abilities. We at Detroit Michigan Bankruptcy Lawyers .com strive to render bankruptcy legal services which are high quality, ethical, and honest, and which bring positive results. We fight for our client’s rights in court. We explain the law to our clients as it affects your case. We promptly return our phone calls and answer your questions and keep you informed of the status of your case. We are fair to our clients. We fully disclose the fee basis on which your case will be taken at the beginning. We strive to keep costs as low as possible. All attorneys at Detroit Michigan Bankruptcy Lawyers .com are highly trained in the use of computer-based office systems and legal research resources. We use state-of-the-art technology including, Bestcase Bankruptcy software which enables us to electronically file your case immediately and can constantly monitor and review your case via the United States Bankruptcy Court's Public Access to Court Electronic Records (PACER) system. All attorneys at Detroit Michigan Bankruptcy Lawyers .com stay current in the latest developments in all our areas of practice and frequently attend seminars and workshops to maintain the highest level of bankruptcy law counseling as possible. General Frequently Asked Questions 1. Bankruptcy, Chapter 7 or 13? Bankruptcy is a Federal Law Provided to you designed to get you a fresh start free from harassing creditor phone calls, lawsuits, repossessions and garnishments. It is a privilege granted to you under the United States Constitution. It is a very powerful law because it forces your creditors to permanently wipe out your debts (chapter 7) or to accept a repayment plan which you have proposed (chapter 13). 2. Should I file for Bankruptcy? Financial problems lead to great stress and can disrupt one's personal and family relationships, yet many people are scared at the thought of having to file for bankruptcy relief. This is exactly what your creditors want you to think. They do not want you to use your right under the law. They would much rather you pay the minimum monthly payment for the rest of your life at 20 to 25% interest!!!!! 3. Will I lose my Property? No, as long as you tell the court what you own and what you think it's worth, the law will allow you to keep your property as the basis for your "fresh start" subject to certain limitations. The law is very generous in allowing you to exempt your home equity, automobiles, household goods and furnishings, clothing, jewelry, bank accounts, stocks and bonds, pension and 401k plans, etc. The most important thing to do is make an accurate list of what you own and what you think it is worth (at a garage sale or auction.) 4. Can I keep my house and car? Yes, you an file a bankruptcy and keep your house and car provided you continue to make payments to the finance or mortgage company. 5. Where are you located? My office is located downtown Detroit, at the corner of Griswold and Fort street in the historic Penobscot Building, Suite 3156. (Click here.) 6. I'm married, can I file alone or must my spouse file jointly? If your married the law recognizes you as one entity and can file either together as a couple (jointly) or either spouse (husband or wife) can file on their own. The law does not require that both file. 7. Will filing Bankruptcy mean I can't get credit for 7 years? I have heard this wives' tale so many times and cannot figure out where it came from. Straight bankruptcy is called Chapter 7, maybe that is where the seven years came from, but the truth is that many people have a better chance of getting credit after they file Bankruptcy. Bankruptcy is definitely a negative mark on a credit report and can be reported for 10 years after filing after which is must be removed. Most people who are considering filing Bankruptcy however already have a negative credit report due to non or late payments, repossessions, charge offs or judgments. A bankruptcy which wipes the slate clean will be an improvement. Keep in mind that credit is not your friend, its what got you here in the first place. Credit is the reason people end up filing for bankruptcy. Credit equals Debt. 8. I can't live without my MasterCard, what will I do? Believe it or not, most retail establishments still accept cash! (Yes, even hotel rooms and car rental agencies). For most people credit cards cause more harm than good. They lead to impulse buying and mask the real pain of paying with cold hard cash or even writing a check. Most of my past clients report to me that they continue to be bombarded with new credit card offers after filing bankruptcy. This is because the credit card companies want to get you back into the game. RESIST at all cost! Consider getting a debit card or a secured credit card. 9. I'm current on all my payments. I've never been late. Can I still file Bankruptcy? I have many clients who look good on paper and appear to be "making it" but realize that the house of cards is about to come crashing down because they have depleted their savings and the ability to transfer balances or "Robbing Peter to pay Paul" just doesn't work anymore. If after you pay your normal monthly living expenses like rent or house payment, utilities, food, clothing, transportation, recreation, insurance and medical care, you don't have enough income left over to make even the minimum monthly payment on your credit card or loan debt, then you are already bankrupt! If you have used one credit card to obtain a cash advance to pay another, the writing is on the wall. Seek relief before you drown in debt. 10. I'm an honest person and want to pay my debts, I don't want to cheat my creditors? First understand that bankruptcy is not about cheating your creditors. Bankruptcy laws are designed to provide a person facing financial difficulty with relief from the stress and burden of debt to allow that person (or family) a "fresh start" while at the same time being fair to the creditors. Chapter 7 Bankruptcy will discharge your "legal" obligation to pay your debts, it will wipe them out. This means that the creditor can't call you at home or at work to try to collect the debt, they can't garnish your wages or seize money out of your bank account. They must leave you alone permanently. After the bankruptcy, if you win the lottery or come into some money and wish to repay those creditors, you may do so of your own free will. If you can afford to pay some amount to your creditors right now, but just not as much as they want, the law encourages you to file a Chapter 13 Bankruptcy in which you make payments to your creditors through the Court for 3 to 5 years. If you fit into one of the situations described here, you may be a good candidate for Chapter 13. There are many reasons why people choose Chapter 13 bankruptcy -- and in particular, choose Chapter 13 bankruptcy instead of Chapter 7 bankruptcy. Generally, you are probably a good candidate for Chapter 13 bankruptcy if you are in any of the following situations: You are behind on your mortgage or car loan, and want to make up the missed payments over time and reinstate the original agreement. You cannot do this in Chapter 7 bankruptcy. You can make up missed payments only in Chapter 13 bankruptcy. You have a tax debt. If a large part of your debt consists of federal taxes, what happens to your tax debts may determine which type of bankruptcy is best for you. You can discharge (wipe out) debts for federal income taxes in Chapter 7 bankruptcy only if all of these five conditions are true: · The taxes are income taxes. Taxes other than income, such as payroll taxes, Trust Fund Recovery Penalty or fraud penalties, can never be eliminated in bankruptcy. · You did not commit fraud or willful evasion. You did not file a fraudulent tax return or otherwise willfully attempt to evade paying taxes, such as using a false Social Security number on your tax return. · You pass the three-year rule. The tax return was originally due at least three years before you file for bankruptcy. · You pass the two-year rule. You actually filed the tax return at least two years before filing the bankruptcy -- having the IRS file a substitute return for you doesn't count unless you agreed to and signed the substitute return. · You pass the 240-day rule. The income tax debt was assessed by the IRS at least 240 days before you file your bankruptcy petition, or has not yet been assessed. If any of the following situations apply to you, you will have to add time to the three-year, two-year or 240-day rules for your debts to qualify for discharge in bankruptcy. · If you submitted an Offer in Compromise, the 240-day rule is delayed by the period from the time from when the Offer is made until the IRS rejects it or you withdraw it, plus 30 days. · If you obtained a Taxpayer Assistance Order from an IRS Problems Resolution Officer preventing the IRS from collecting, the bankruptcy court may require that you add the time collection was suspended to the three-year, two-year and 240-day requirements. · If you filed a previous bankruptcy case, all three time periods stopped running while you were in the prior bankruptcy case. You must add the length of your case plus six months to all three. Even if your taxes do qualify for discharge in a Chapter 7 bankruptcy case, your victory may be bittersweet. This is because prior recorded tax liens are not affected by your filing. A Chapter 7 bankruptcy will wipe out only your personal obligation to pay the debt. Any lien recorded before you file for bankruptcy remains. After your bankruptcy, the IRS can seize any property you owned at the time the bankruptcy was filed. But this doesn't mean that after your bankruptcy case is over the IRS will come and grab your property. Post-bankruptcy, the IRS tends to seize only real estate and retirement accounts or pensions. And even then, IRS seizures generally take place only when a taxpayer has made no efforts to otherwise resolve the problem. Furthermore, IRS collectors must obtain approval from their supervisors before seizing a house or pension. The IRS is very concerned about negative publicity. If you cannot discharge your tax debts in a Chapter 7 bankruptcy, Chapter 13 may be a better alternative. There, you pay your tax debts over time. You have a sincere desire to repay your debts, but you need the protection of the bankruptcy court to do so. You need help repaying your debts now, but need to leave open the option of filing for Chapter 7 bankruptcy in the future. This would be the case if for some reason you can't stop incurring new debt. You are a family farmer who wants to pay off your debts, but you do not qualify for a Chapter 12 family farming bankruptcy because you have a large debt unrelated to farming. You have valuable nonexempt property. When you file for Chapter 7 bankruptcy, you get to keep certain property, called exempt. If you have a lot of nonexempt property (which you'd have to give it up if you file a Chapter 7 bankruptcy), Chapter 13 bankruptcy may be the better option. You received a Chapter 7 discharge within the previous six years. You cannot file for Chapter 7 again until the six years are up. You have a codebtor on a personal debt. If you file for Chapter 7 bankruptcy, your creditor will go after the codebtor for payment. If you file for Chapter 13 bankruptcy, the creditor will leave your codebtor alone, as long as you keep up with your bankruptcy plan payments. AlgonacAllen ParkAlmontAnchorvilleAnn Arbor ArgentineArmadaAuburn HillsAugusta Township Back to top B BerkleyBellevilleBirmingham Bloomfield HillsBrightonBrownstown TownshipBurtonByron Back to top C Canton TownshipCarletonCasco TownshipCenter LineChesterfield Township ClarkstonClawsonClay TownshipClinton TownshipCommerce Township Back to top D DavisburgDavisonDearbornDearborn Heights DetroitDexterDrayton PlainsDryden Back to top E East China TownshipEastpointeEcorse ElbaEstral Beach Back to top F Fair HavenFarmingtonFenton FerndaleFlintFlat RockFraser Back to top G Garden CityGibraltarGoodrichGrand Blanc GregoryGreen Oak TownshipGrosse IleGrosse Pointe Back to top H HadleyHamburgHamtramckHartlandHarsens IslandHazel Park HighlandHollyHowellHuntington WoodsHuron Township Back to top I Imlay CityInkster Back to top J Back to top K Keego Harbor Back to top L Lake OrionLapeerLathrup Village LeonardLincoln ParkLindenLivonia Back to top M Madison HeightsMarine CityMaybeeMelvindale MetamoraMilfordMonroeMt. Clemens Back to top N New BaltimoreNew HavenNew Hudson NewportNorthvilleNovi Back to top O . Oak ParkOrchard Lake OrtonvilleOxford Back to top P Pleasant Ridge PlymouthPlymouth Township PontiacPinckneyPortage Lake Back to top R RawsonvilleRedford RichmondRiver Rouge RockwoodRomeoRomulusRosevilleRoyal Oak Back to top S Salem TownshipShelby TownshipSouthfieldSouthgate South LyonSt. Clair ShoresSterling HeightsSumpter TownshipSylvan Lake Back to top T TaylorTrenton Troy Back to top U Utica Union Lake Back to top w Walled LakeWarrenWashingtonWaterfordWayneWest Bloomfield White Lake TownshipWillisWindsorWixomWolverine LakeWyandotte Back to top Y YpsilantiYork Township Bankruptcy is a legal process that allows individuals or businesses that cannot pay their debts to have some or all of their debts discharged or reorganized. This enables the debtors to get a "fresh start" on their finances. It also attempts to provide a fair method for compensating creditors. Chapter 7 Bankruptcy is the most common type of bankruptcy proceeding. It is a liquidation type of proceeding (as opposed to a reorganization proceeding). All of the debtor's assets, with the exception of "exempt" property, will be sold, and the proceeds will be used to pay their debts. If the proceeds are not enough to pay off all the debts, unpaid amounts on "dischargeable debts" will be discharged. First the debtor files a bankruptcy petition in which he lists all of his assets as well as all of his outstanding debt. Assets fall into two categories. Exempt assets are those that the debtor will be able to keep after the bankruptcy proceeding. Generally a certain amount of equity in a person's home, a certain amount of equity in a vehicle, a small amount for clothing, and a small amount for other personal items will be considered exempt property. The exact value of the exemptions will vary depending on what jurisdiction the bankruptcy is filed in. Non-exempt assets are all of the debtor's assets that are not exempt. The trustee who is appointed in the Chapter 7 bankruptcy will collect all of the debtor's non-exempt assets and sell them. The proceeds will be distributed to the creditors. Chapter 13 Bankruptcy is what is known as reorganization bankruptcy. Chapter13 bankruptcy is filed by individuals who want to pay off their debts over a period of three to five years. This type of bankruptcy appeals to individuals who have non-exempt property that they want to keep. It is also only an option for individuals who have predictable income and whose income is sufficient to pay their reasonable expenses with some amount left over to pay off their debts. The debtor will file a bankruptcy petition that includes schedules of the debtor's assets and liabilities. Then the debtor will have a limited amount of time to file a repayment plan with the court. Once the plan is filed the person's creditors and the Chapter 13 bankruptcy trustee will have a limited amount of time to object to the plan. If there are no objections and the plan is confirmed, the debtor and the creditors must follow it. In order to be confirmed a reorganization plan must meet confirmation tests. One of these tests compares the amount that the unsecured creditors will receive under the plan to the amount they would receive under a Chapter 7 bankruptcy. Unsecured creditors must receive at least the same amount under the Chapter 13 plan as they would in a Chapter 7 bankruptcy. Another test requires that the debtor must also pay all of his disposable income into the repayment plan. With a Chapter 13 bankruptcy the debtor may keep all of their property whether it is exempt or non-exempt. The main reason for dividing property into the exempt and non-exempt categories in a Chapter 13 bankruptcy is for purposes of comparing it to a Chapter 7 bankruptcy in a confirmation test. The debtor may, however, give up some secured property to the secured creditor as part of the reorganization plan. If a debtor wants to keep secured property, but has fallen behind on payments, Chapter 13 bankruptcy allows the debtor to keep the property and get caught up on missed payments during the reorganization. For example a debtor who is facing a foreclosure for failing to make several mortgage payments can halt the foreclosure by filing for Chapter 13 bankruptcy. What is known as an "automatic stay" is ordered by the court, preventing creditors from taking any collection actions pending the outcome of the bankruptcy proceeding. The debtor can then use the reorganization period to get caught up on past due amounts, thereby avoiding foreclosure. If the debtor is unable to get caught up on payments during this period, he will still be subject to foreclosure at the end of the reorganization. For secured property with a value that is less than the amount of the debt that is owed, there are 2 options. The debtor may return the property to the creditor who will be able to sell the property and keep the proceeds to satisfy the debt. Any excess debt that is not is not satisfied through the sale of the property will become unsecured debt. If the debtor keeps the property, the reorganization plan will require the debtor to repay the debt up to the value of the property. The excess amount of debt will be converted to unsecured debt. Non-secured creditors share whatever amounts are left over after priority claims have been satisfied. In a Chapter 13 bankruptcy some of the debtors payments will go to unsecured creditors. The unpaid portion of the non-secured debts will be discharged at the end of the reorganization period. There are other important differences between Chapter 7 and Chapter 13 bankruptcy. Contact Detroit Michigan Bankruptcy Lawyer Walter Metzen who has the legal experience in the practice of bankruptcy law to determine which type is best for your situation.

We are a Federally Designated Debt Relief Agency and Bankruptcy Lawyers who help people file for bankruptcy relief under the Bankruptcy Code. We do not retain clients on the strength of advertising material alone but only after following our own engagement procedures based on in-person interviews, conflict checks, and retainer agreements. The information contained on this site is intended to educate members of the public generally and is not intended to provide solutions to individual problems. Nor does the use or reliance of information contained on this web site constitute the establishment of a lawyer-client relationship. Readers are cautioned not to attempt to solve individual problems on the basis of information contained herein and are strongly advised to seek competent legal counsel before relying on information on this site.