Filing For Chapter 13 Bankruptcy
If you are considering filing for Chapter 13 bankruptcy, our Southfield, MI Chapter 13 bankruptcy lawyer can help you make an informed decision and assist you throughout the legal process. There are many important considerations when deciding to file for bankruptcy, such as choosing between filing for Chapter 7 or 13. A Chapter 13 bankruptcy lawyer can explain the nuances of Chapter 13 and other types of bankruptcy and help you determine if it is the right step for you to take. To discuss your situation with a lawyer today, contact our team at Gudeman & Associates, P.C. to schedule a consultation.
Understanding Chapter 13 Bankruptcy
Chapter 13 bankruptcy is often referred to as “reorganization bankruptcy.” This is because it involves repayment of debts through a payment plan that spans a period of three to five years. Eligibility of Chapter 13 is usually dependent on having a stable income with enough disposable income to repay debts according to the repayment plan. It is often the right choice for individuals who wish to protect assets such as their home or car and can meet the strict terms of a repayment plan in order to do so.
Your Repayment Plan
Your exact repayment plan will vary based on your debts and assets, but there are some general guidelines for a repayment plan in the Eastern District of Michigan that our Southfield Chapter 13 bankruptcy lawyer can help you understand.
The first step of your repayment plan is putting together a budget of your income and expenses. Enough income will be used by you for your necessary and typical expenses such as food, utilities, gas, and clothing. Other income will be set aside to make payments to creditors.
Payment to creditors in Chapter 13 bankruptcy is paid to a trustee who distributes the payment to your creditors. If you were current on home and car payments at the time of filing, you may continue making these payments to your creditors rather than a trustee. If possible, this allows you to avoid administrative fees that are added to your payment.
In your repayment plan, you will pay the trustee a set amount that covers secured and priority claims. If you have extra disposable income, it will often be used to pay unsecured creditors.
How a Lawyer Can Help You
Our Southfield Chapter 13 bankruptcy lawyer can assist you through every step of the process when filing for Chapter 13 bankruptcy. Our assistance starts with a consultation where we will listen to the details of your specific situation and advise you on the best path forward for you. From there, we will assist you in filing and represent you throughout the duration of your repayment plan, helping ensure that the process goes smoothly from its inception to the end of your repayment plan.
We understand the delicacy and importance of a decision such as filing for bankruptcy. It is our job not only to provide legal assistance, but also some comfort and peace of mind during a difficult period for you. Your case and your financial well-being is important to us, and we will work hard to help you work towards a brighter future. To discover more about how we can assist you, contact Gudeman & Associates, P.C. today.
Qualifying for Chapter 13 Bankruptcy
Our compassionate Southfield, MI Chapter 13 bankruptcy lawyer knows that facing financial challenges can be overwhelming. If you’re struggling with debt and seeking a way to regain control of your finances in Michigan, Chapter 13 bankruptcy may offer a viable solution. This legal process allows individuals to create a manageable debt repayment plan while retaining their assets and avoiding the liquidation of their property.
Meeting the Income Eligibility Criteria
To qualify for Chapter 13 bankruptcy in Michigan, you must meet specific income eligibility criteria. Your income, whether from employment, self-employment, or other sources, must be sufficient to cover your essential living expenses and allow you to make regular payments toward your debt repayment plan.
Completing Credit Counseling
Before filing for Chapter 13 bankruptcy, individuals in Michigan are required to undergo credit counseling from a government-approved agency. This counseling aims to assess your financial situation, explore alternative solutions, and provide valuable financial education. Once you complete the credit counseling, you’ll receive a certificate, which is a crucial document for your bankruptcy filing.
Secured and Unsecured Debt Limits
Chapter 13 bankruptcy involves distinguishing between secured and unsecured debts. Secured debts are tied to collateral, such as a mortgage or car loan, while unsecured debts have no collateral, like credit card debt or medical bills. There are specific limits on the amount of secured and unsecured debt you can have to qualify for Chapter 13. These limits can change, so it’s essential to consult with your Southfield Chapter 13 bankruptcy lawyer to ensure your debt falls within the allowable limits.
Commitment to a Repayment Plan
Chapter 13 bankruptcy revolves around creating a manageable repayment plan, typically spanning three to five years. To qualify, you must demonstrate your ability to commit to this plan by making regular payments on time. The plan should cover priority debts, such as taxes or child support, and contribute to the repayment of unsecured debts.
Not Having Filed for Chapter 13 in the Past
In Michigan, you’re generally eligible for Chapter 13 bankruptcy if you haven’t filed for this type of bankruptcy within the past two years. Additionally, if you’ve had a Chapter 7 bankruptcy discharge within the past four years or a Chapter 13 bankruptcy discharge within the past two years, you may need to wait before filing for Chapter 13 again.
Consult Our Team For Guidance
Navigating the complexities of Chapter 13 bankruptcy in Michigan requires legal expertise and a comprehensive understanding of the state’s laws and regulations. We specialize in bankruptcy law and have a deep commitment to helping individuals regain financial stability. Our experienced attorneys will assess your unique situation, guide you through the bankruptcy process, and develop a repayment plan that suits your needs.
If you are considering Chapter 13 bankruptcy in Michigan or have questions about your eligibility, we invite you to contact Gudeman & Associates, P.C. today. Our dedicated team is ready to provide personalized assistance and help you take the first steps toward a brighter financial future. Don’t let debt control your life; let us be your trusted partner in achieving financial relief and peace of mind. Call our Southfield Chapter 13 bankruptcy lawyer for help today.
5 Differences Between Chapter 7 And Chapter 13
When facing overwhelming debt, individuals often turn to bankruptcy as a means of obtaining financial relief. Two common forms of bankruptcy are Chapter 7 and Chapter 13, each offering different benefits and considerations. Understanding the key differences between these two chapters is crucial for making informed decisions about your financial future. A Southfield, MI Chapter 13 bankruptcy lawyer can help you decide between the two based on their professional opinion as there are important differences to be aware of:
1. Eligibility Requirements
One of the primary differences between Chapter 7 and Chapter 13 bankruptcy is the eligibility requirements. Chapter 7 bankruptcy is typically available to individuals with limited income who pass the means test, which evaluates their ability to repay debts. On the other hand, Chapter 13 bankruptcy is designed for individuals with a regular income who can afford to repay some or all of their debts through a repayment plan.
2. Asset Protection
Another significant difference between Chapter 7 and Chapter 13 bankruptcy is how assets are treated. In Chapter 7 bankruptcy, non-exempt assets may be liquidated to repay creditors, while exempt assets are protected from liquidation. In contrast, Chapter 13 bankruptcy allows individuals to retain their assets and repay debts over time through a court-approved repayment plan.
3. Debt Discharge
Chapter 7 bankruptcy offers a relatively quick debt discharge process, typically within a few months of filing. However, not all debts are dischargeable in Chapter 7, including certain tax debts, student loans, and child support obligations. In contrast, Chapter 13 bankruptcy involves a repayment plan that lasts three to five years, during which some debts may be discharged upon completion of the plan. Depending on how much debt you have and what kind of debt it is, a lawyer can direct you towards the best bankruptcy plan for your situation.
4. Repayment Plan
In Chapter 7 bankruptcy, there is no repayment plan; instead, non-exempt assets are liquidated to repay creditors. In Chapter 13 bankruptcy, individuals propose a repayment plan to the court, outlining how they will repay their debts over the course of three to five years. The repayment plan must be feasible and approved by the court, and individuals must make regular payments to a trustee, who distributes the funds to creditors.
5. Duration Of Bankruptcy Process
Chapter 7 bankruptcy typically offers a faster resolution than Chapter 13 bankruptcy. Chapter 7 cases are usually completed within a few months of filing, allowing individuals to obtain a fresh financial start relatively quickly. In contrast, Chapter 13 bankruptcy involves a longer process, as individuals must adhere to a repayment plan for three to five years before receiving a discharge of eligible debts. However, all this is dependent upon what your Southfield Chapter 13 bankruptcy lawyer thinks about your particular case as each one is unique and will have different timelines.
At Gudeman & Associates, P.C., we understand the complexities of bankruptcy law and are here to help you navigate the process. Whether you’re considering Chapter 7 or Chapter 13 bankruptcy, our experienced Southfield Chapter 13 bankruptcy lawyer can provide you with personalized legal guidance and representation. Contact us today to schedule a consultation and take the first step toward a brighter financial future.