Chapter 7 Bankruptcy in Ann Arbor, MI

Debt Relief Through Chapter 7 Bankruptcy

The first few questions most people have when they are considering filing for bankruptcy are “What can bankruptcy do for my financial situation?” or “How much cash is exempt in Chapter 7 in Michigan”? The answer to that question depends upon the type of debt you have, your income and the type of bankruptcy filing you can make.

At the law firm of Marrs & Terry, PLLC, our bankruptcy attorneys will review your finances and advise you if you qualify for Chapter 7 or Chapter 13 bankruptcy. Chapter 7 has specific eligibility requirements (a means test) so not everyone who has serious debt will qualify. Contact our law office to schedule a free consultation. We have two Michigan offices for your convenience: Ann Arbor and Jackson.

How Can Chapter 7 Bankruptcy Help You?

Many people who qualify for Chapter 7 bankruptcy have had a permanent or longer-term loss of income, such as a job loss or loss of child support or alimony. Chapter 7 is a good option for people to protect their financial future and those who have a great deal of unsecured debt, such as medical bills. Under Chapter 7 bankruptcy, most unsecured debt is “discharged,” meaning it is forgiven.

If you have missed some mortgage payments but your house has not gone to foreclosure sale yet, our bankruptcy lawyers may be able to help you avoid or delay foreclosure. We bring more than 18 years of experience to every case, and we offer in-home appointments upon request.

Do I qualify for Chapter 7 bankruptcy in Michigan?

Bankruptcy is a way for you to stop creditor collection efforts and possibly discharge many of your debts. Although people with any level of income can require bankruptcy protection, the most aggressive and fastest form of bankruptcy is only available to those with a household income lower than the state median where they qualify to file.

Chapter 7 bankruptcy does not require that you try to repay your creditors through a repayment plan like Chapter 13 requires, although it may require that you liquidate some of your assets to pay them off before your discharge. Still, you won’t have to spend three to five years making payments like you would in a Chapter 13 filing. How do you know if you can qualify for a Chapter 7 bankruptcy in Michigan?

What is the median income in Michigan?

If you are the only person in your household, you can have an adjusted annual income of as much as $53,815 and still qualify for Chapter 7. Those in two-person households can have up to $67,015 in income, while three people in the family will increase the income limit to $80,465. If you have four total family members, you can qualify with up to $99,179 in income, and you can add another $9,000 to that for every additional family member beyond the first four.

Chapter 7 bankruptcy can be an excellent option for someone who is experiencing a temporary downturn in income or who does not have substantial personal assets at risk. The better that you understand Chapter 7 bankruptcy, the easier it will be to choose the right kind of bankruptcy for you.

Some Debts Cannot Be Discharged

If you have secured debt such as a car loan, a boat loan, or a home mortgage, this debt is not discharged if you want to keep the property. If you wish to keep the car, boat, or home, you can reaffirm the loan and continue to pay according to the original terms of the loan agreement. See the page on secured debt to learn more about how secured debt is handled under Chapter 7.

In Chapter 7, you cannot discharge:

  • Student loan debt
  • Tax debt
  • Court-ordered alimony or child support

Have you been told you don’t qualify for Chapter 7 but think you do? Talk with one of our bankruptcy lawyers for a second opinion. We have been able to help many people in your situation achieve bankruptcy under Chapter 7 or Chapter 13 of the U.S. Bankruptcy Code.

Contact Us Today. We Are Here To Help You Find Relief.

Take action to change your financial future. Contact Marrs & Terry online or call us toll-free at 734-663-0555.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.