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Ann Arbor Law Blog

Student loans linked to surge in prenuptial agreements

Prenuptial agreements have become far more common in Michigan and around the country in recent years according to a 2016 survey from the American Academy of Matrimonial Lawyers. The association's members say that requests for prenuptial agreements have increased by 61 percent over the last three years, but they also point out that the reasons given by couples for wanting one have changed.

Prenuptial agreements gained popularity in the 1970s when the nation's divorce rate was approaching its zenith. These agreements have generally been entered into when one spouse has far more in the way of income and assets than the other, but the data suggests that many millennial couples today are asking for a prenuptial agreement because of concerns over student loans or other debts. The number of couples carrying student debt increased from 17 percent in 1989 to 41 percent in 2013, and students who graduated in 2015 left school with an average of $30,100 in educational loans.

Bankruptcy attorneys object to trustee password request

When Michigan consumers file for Chapter 7 bankruptcy, they are asked to provide information to trustees about finances and various accounts. However, at least two trustees in Maryland have deviated from the usual procedure by making a request for information that bankruptcy attorneys have called intrusive and warn may discourage others from filing for bankruptcy.

The trustees have requested that debtors give their passwords for eBay, Amazon Prime and PayPal accounts. The paperwork further says that debtors must keep these accounts open and are not permitted to change their passwords for 10 days. It is unclear who will have access to this information or what will be done with it, but one bankruptcy attorney says the same information can be obtained with less invasive measures. For example, a trustee can ask to see statements. Furthermore, while bankruptcy attorneys agree that trustees have a right to investigate accounts and ask more questions if it seems necessary, they object to requiring the information at the outset.

Understanding the changes in Michigan's medical marijuana law

With ever-changing marijuana laws across the country and in Michigan alone, it can be confusing to understand what is legal or illegal. Medical marijuana is legal in Michigan and the law just underwent several changes. A lot of people are wondering how many plants a patient or caregiver can grow.

Everyone must be aware of the new laws and regulations so they do not get in legal trouble. Keep reading for an analysis of what laws changed for medical marijuana in Michigan and what might be next.

Credit cards and the death of a holder

Michigan residents dealing with the aftermath of a loved one's death might have to deal with unpaid debts on credit cards. When someone who was the sole account holder dies, then the creditor could make a claim for the debt upon the estate. Surviving family members would not be obligated to pay except for surviving spouses in community property states.

For someone who had been an authorized user of a dead person's credit card, the debt does not transfer to the surviving user. The death of the account holder, however, rescinds the charging privileges of any authorized users. An attorney recommended that people check account terms to confirm that the card company imposed no liabilities upon authorized users.

The consequences of missing different monthly payments

All your bills are flowing in and you are wondering if you are going to be able to afford them. You might be thinking of skipping a payment or two, but which ones? Skipping a monthly payment has consequences, but each one is unique. Missing a cell phone bill is much different from missing a mortgage payment.

So, what do you do in this situation? Before you decide what bill to put off until next month, consider what could happen.

When debt consolidation is not a solution

Michigan consumers who are struggling with certain financial obligations might consider a debt consolidation loan. While this might appear to be a way to get control of debt and lower monthly payments, it might not be a long-term solution because if a person has a spending problem, it does not address that.

One man took out a debt consolidation loan because he hoped to avoid filing for bankruptcy a second time. The $17,000 loan from his credit union, which he was to pay back over five years, paid off ten credit cards. With an 8 percent interest rate and a monthly payment of $375, his terms were better than they had been with the cards. Still, as he also began helping to support his daughter, a single mother, he found himself struggling again. He took out a payday loan to help her, but she lost her job. The $5,000 tax refund she intended to use to pay him back went to support her children.

Study uncovers high divorce rate among military personnel

Michigan residents may be surprised to learn that what spouses do for a living can influence their chances of remaining married. Researchers from the career information company Zippia used data from the U.S. Census Bureau to track divorce rates among various occupations, and they found that working in the military can be hard on married life. Military jobs took the top three places in Zippia's ranking of occupations with the highest risk of divorce by the age of 30, and first-line enlisted supervisors topped the list with a divorce rate of 30 percent. First-line enlisted supervisors lead and coordinate combat operations.

Demanding occupations can put great pressure on marriages, and these stresses may be even more severe among military couples who are often forced to spend prolonged periods apart. A 2016 study published in the Journal of Population Economics reveals that divorce rates soar when military personnel are deployed and continue to increase with every month spent overseas.

The downsides of debt consolidation

Michigan residents may believe that a debt consolidation loan may be the answer to their debt issues. However, this is not always the case, and it is possible that debtors may find themselves even deeper in debt after consolidating. This is because consolidating existing debt doesn't address the issue of why a person spent too much money to begin with.

One man was able to reduce his credit card payments to about $375 a month thanks to a loan from a credit union. However, it also gave him the ability to accrue more credit card debt, and that money was spent on a television or computer. Instead of noticing the 25 percent interest rate, all he saw was the $35 monthly payment to have that computer. Now in bankruptcy, he closed his credit card accounts and tries to save for items that he really wants.

Bankruptcy trustee claims debtor abused the process

Michigan residents who file for bankruptcy can expect to have their finances scrutinized. In a Virginia case of a man who filed for Chapter 7 protection and had two homes, the bankruptcy court found that he had not abused the system despite a challenge from the trustee overseeing his debt discharge.

The man's family had been financially stretched after he incurred $60,000 in student loans and his wife purchased another home to accommodate her mother who had dementia. The trustee contended that he could sell one property and then pay his creditors. The court, however, sided with the man by ruling that his expenses for two properties did not represent an abuse of the law.

How much say do children get in a divorce?

A big part of divorce involves deciding how custody of children gets split between the two parents. In 2015 alone, there were 29,748 divorces filed in the state of Michigan. Many of those had children involved, and as a result, they were a lot more complicated.

While the parents will make cases for why they should receive majority or sole custody, it is important to remember that the children also get a say. There are various circumstances when a court would find it prudent to ask a child his or her opinion.

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