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Chapter 7 Bankruptcy - Overview

Do you have more debt than you think you can pay back? Do you need advice regarding a Michigan Chapter 7 Bankruptcy? John Steinberger is a Board Certified Bankruptcy Attorney with over 30 years of experience.  He has filed over 10,000 Michigan bankruptcies during his career.  If you are looking for a Michigan bankruptcy attorney, John Steinberger and his team have the experience you need.

After a free consultation and reviewing your financial information, our law firm will advise you on what type of bankruptcy, if any, may be best for you.  Filing for a Chapter 7 Bankruptcy gives you a fresh start by the discharge of most or all of your debts.  Filing for a Chapter 13 Bankruptcy results in a reorganization and structured payment of your debts over a period of 3 to 5 years with a discharge of your unsecured debts upon completion.

What is a Michigan Chapter 7 Bankruptcy?

1. Debts Discharged: With a Michigan Chapter 7 Bankruptcy, most debts are discharged. Even if you fail to list a creditor, the debt will be discharged. You must list all your creditors even if you intend to pay them.

2. Debts Not Discharged: Some debts can not be discharged.  Examples of debts that are not discharged are child support, student loans under most circumstances, certain taxes, etc.  If you retain our law firm, we will review your financial information and determine which debts cannot be discharged.

3. Exempt Property: The bankruptcy laws allow you to "exempt" some of your property.  This means that you will be able to keep your property.  Our bankruptcy attorneys will review your property and determine the proper exemptions. The following are examples of typical Chapter 7 Bankruptcy exemptions:

  • Approximately $21,000.00 under federal bankruptcy law for equity in a home
  • Approximately $9,000.00 in household goods under Federal bankruptcy law
  • Approximately $11,000.00 in cash under Federal exemption in certain cases
  • Approximately $3,500.00 in equity on a vehicle plus unused wild card exemption

4. Debts You May Want to Continue to Pay (Mortgage, Car Loan and Loan on Household Items): You may keep your house, vehicle and certain financed household items as long as you continue to keep the payments current. Generally to keep a vehicle, you must sign a reaffirmation agreement provided by the creditor.  Certain creditors, especially for vehicles, may stop sending a statement after the case is filed, and if you want to keep this property you must maintain the payments.  Reaffirmation agreements are only valid if filed with the court. Reaffirmation agreements can be cancelled at anytime prior to discharge or within 60 days of filing the agreement. Cancellation of a reaffirmation agreement should be done in writing and filed with the court.  The effect of reaffirming a debt makes you liable for the debt after the bankruptcy is closed and allows a creditor to sue you on the debt if it becomes delinquent.  If a reaffirmation agreement is not entered into for a vehicle or other property, the creditor may repossess the vehicle or property within 45 days after the first meeting.

5. Joint Obligation for Debt: If you have a joint obligation with a spouse or co-signer, he or she will still be responsible for that debt unless he or she also files for bankruptcy.

6. Michigan Chapter 7 Bankruptcy and Your Credit: The bankruptcy will be reported on your credit for 10 years from the date that you receive a discharge.  Your creditor history will still appear on the credit report; however, the creditors have no legal right to collect unless the debt is non-dischargeable.  You can usually purchase a vehicle after the discharge; however, the interest rate will generally be very high.  You may be able to obtain a mortgage or refinance a house usually 2 to 3 years from the date of discharge.

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Testimonials

Mr. Steinberger was a wonderful and patient attorney. He took time in preparing my case properly so that it would be successful. I would recommend him highly to my family and friends. Read More
– T.G., Southgate, MI

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