Are you struggling under the weight of credit card, mortgages, and other debts you can’t pay off? If so, bankruptcy can provide you with an avenue to resolve your financial troubles and obtain a fresh start. Filing for bankruptcy can be a crucial first step on the path to debt relief, but it’s not one you should make alone. You deserve experienced legal guidance to help you make the best decisions during this challenging time.
Contact Marrs & Terry for an initial case evaluation with our bankruptcy lawyers to determine whether filing for Chapter 7 or Chapter 13 can put you on the path to financial freedom.
Understanding Bankruptcy
Federal law allows individuals to file for bankruptcy when they can no longer afford to pay their debts. In bankruptcy, a debtor will sell their property to generate funds to pay debts or create a repayment plan to repay creditors over time. Federal bankruptcy courts oversee the bankruptcy process, including liquidating a debtor’s assets or creating and fulfilling repayment plans.
At the end of a bankruptcy case, debtors may obtain a legal release from most outstanding debts. As a result, bankruptcy can give people struggling with unmanageable debt a fresh start. Bankruptcy filings remain on individuals’ credit reports for several years, which can make it challenging to borrow money soon after filing for bankruptcy. However, it’s also easier to start rebuilding your finances and looking to the future once the crushing weight of untenable debts has been lifted.
How Can Bankruptcy Help You?
Filing for bankruptcy can provide you with several crucial benefits, including the following:
- Automatic stay: The bankruptcy protection provided by an automatic stay is one of the top benefits of filing, as it prohibits your creditors from taking any acts to collect your debts. Under the automatic stay, creditors cannot send you debt collection letters or make debt collection calls, file lawsuits to collect debt, foreclose on your home, repossess assets securing debts (such as your vehicle), or garnish your wages or bank accounts. Any creditor wishing to begin or resume debt collection activities during your bankruptcy case must seek approval from the bankruptcy court.
- Discharge of debts: At the end of your bankruptcy case, the bankruptcy court can discharge many types of outstanding debt after you’ve made the required payments to your creditors. A discharge means you no longer have any legal obligation to pay discharged debts, and the creditor cannot take legal action to collect that debt. Bankruptcy discharge can give you a fresh start free of burdensome debts.
- Debtor-in-possession: In Chapter 13 bankruptcy, you can become a “debtor-in-possession,” which means you retain ownership and control over your assets rather than turning over control to a bankruptcy trustee.
Types of Bankruptcy We Can Help You With
Under federal bankruptcy law, individuals typically can choose between two types of bankruptcy: Chapter 7 and Chapter 13. The bankruptcy lawyers with Marrs & Terry can guide you through either.
Chapter 7 bankruptcy
In Chapter 7 bankruptcy, also known as liquidation bankruptcy, a debtor “liquidates,” or sells, most of their assets to generate cash to pay creditors. Debtors may keep specific categories of assets known as “exempt” property, with federal bankruptcy or state law specifying assets exempt from liquidation. After the bankruptcy trustee liquidates the debtor’s estate and pays the debtor’s creditors according to the Bankruptcy Code, the bankruptcy court can discharge many forms of debt that remain outstanding, freeing the debtor from any obligation to pay those debts.
Individuals wishing to file for Chapter 7 bankruptcy must meet eligibility requirements. First, they must complete credit counseling no more than 180 days before filing their bankruptcy petition. They must also meet the means test, which looks at whether their income falls below the median income in their state or whether they have sufficient disposable income to repay creditors.
Chapter 13 bankruptcy
In Chapter 13 bankruptcy, also known as “wage earner’s” bankruptcy, a debtor pays back creditors according to a three- or five-year plan. Debtors typically file for Chapter 13 bankruptcy when they have sufficient disposable income to pay down their debts. Chapter 13 bankruptcy has several advantages over Chapter 7 bankruptcy, including allowing debtors to get out of foreclosure proceedings and keep their homes or extend payments on other secured debts for the duration of the Chapter 13 plan. Individuals may file for Chapter 13 if they have combined scheduled and unscheduled debts of less than $2.75 million.
After the bankruptcy court approves the Chapter 13 plan, the debtor pays a bankruptcy trustee, who disburses those funds to the debtor’s creditors per the plan’s terms. Upon completing the plan, a debtor may receive a discharge of any outstanding eligible debts.
Why Choose the Bankruptcy Lawyers at Marrs & Terry?
The bankruptcy process can involve complex laws and court rules, and a single mistake can jeopardize your bankruptcy case and efforts to obtain debt relief. Hiring experienced legal counsel can make the bankruptcy process far more efficient and far less stressful. For over two decades, individuals and families in Jackson, Michigan, have turned to the bankruptcy lawyers at Marrs & Terry for dedicated guidance and support in pursuing financial freedom. They do so because of our:
- Experience – Our attorneys have decades of legal experience and in-depth knowledge of bankruptcy laws to help you find tailored solutions to your needs and goals. We have built a record of success in helping clients achieve favorable resolutions to their legal and financial situations.
- Honesty – When you turn to Marrs & Terry for help resolving financial difficulties, you can expect your bankruptcy attorney to give you an honest assessment of your situation and legal options. We will never tell you only what you want to hear or sugarcoat the truth. Our attorneys want to help you identify and pursue realistic solutions to your problems.
- Results-oriented focus – We take the time to listen to you and understand what you consider most important. We focus on helping you achieve your short- and long-term goals through tailored legal solutions. Our attorneys will provide you with the advice and support you need to make informed decisions at each stage of your case.
Benefits of Hiring a Bankruptcy Attorney
Filing for bankruptcy can have long-term legal and financial consequences. Furthermore, the bankruptcy process involves highly technical laws and procedures. Although having a lawyer is not a legal prerequisite to filing for bankruptcy, legal counsel has many benefits. Bankruptcy lawyers can help you throughout your case by:
- Undertaking financial consultations to evaluate your legal options for debt relief
- Identifying the best path to resolve your debts, whether that involves filing for bankruptcy or pursuing other services or legal protections
- Determining your eligibility for Chapter 7 or 13 bankruptcy
- Gathering the information and records to prepare your bankruptcy petition
- Helping you develop a repayment plan in a Chapter 13 bankruptcy case
- Advocating for your rights and interests during court proceedings and creditors’ meetings
Contact Us Today for an Initial Case Evaluation to Discuss Your Options
If you’re in need of debt relief, bankruptcy can give you a fresh start on the path toward financial health. Get the legal assistance and advocacy you need to protect your rights and interests. Contact Marrs & Terry today for a confidential consultation to speak to a bankruptcy attorney about your legal options.