Chapter 13 Bankruptcy

Bankruptcy Attorney Guiding Oakland County Residents and Other Michigan Debtors

If financial strain is causing you to consider the possibility of filing for protection from your creditors under the federal bankruptcy laws, you should talk to attorney Ronald S. Siegel about your options, including protection under Chapter 13. Along with Chapter 7, bankruptcy relief under Chapter 13 of Title 11 of the United States Code is one of the most commonly filed forms of bankruptcy. Sometimes referred to as a “wage earner’s plan” and the section of the bankruptcy code used most often to save a home from foreclosure due to delinquent payments and/or taxes, Chapter 13 bankruptcy is, at its core, a reorganization of the debtor’s finances and obligations. Seasoned Oakland County bankruptcy lawyer Ronald S. Siegel is well-versed in Chapter 13 and other alternatives for Michigan residents who find themselves unable to meet their current obligations to creditors.

Discharge Under Chapter 13 Bankruptcy

Bankruptcy relief under Chapter 13 is often the right choice for debtors who, because of relatively high income, either may not qualify for Chapter 7 or who wish to save their home from an impending or threatened foreclosure. It allows people who cannot afford to pay the monthly amounts that their creditors want to pay down their debts as much as their monthly income and living expenses will allow. Under Chapter 13, the debtor (and their spouse, if they file jointly) proposes a plan that allows them to pay a court approved amount towards certain debts over a period of three to five years that may, depending on the amount of the payment and the amount of the debt, result in the creditors getting only a small portion of what is owed (and usually at zero interest), with the balance of whatever debt that is not paid being discharged. In some cases, debts may be discharged with minimal payment or even no payment, depending upon the nature of the debtor’s obligations. The exact amount of the Chapter 13 payment will vary from case to case depending on the debtor’s monthly income and monthly living expenses as well as the nature and amount of the debts. Attorney Siegel's experience and familiarity with the bankruptcy code, the courts and the trustees will help formulate an acceptable yet affordable plan that allows you and your family to live a normal and happy life free from the constant pressure of lawsuits, garnishments, foreclosures and creditor harassment.

A debtor filing for either Chapter 7 or Chapter 13 must file documents with the court, referred to as “schedules,” of their assets and liabilities, current income and expenditures, and any contracts or unexpired leases to which the debtor is a party. In Chapter 13, the debtor must also file a plan, which is the debtor’s proposal on how to deal with their debt. Typically, the plan will propose to either keep a house (while outlining a proposal for how to pay the monthly mortgage payments along with any arrearage that exists) or to surrender the house, as well as whether to keep or surrender vehicles. Finally, the plan will set forth a proposal on how and how much to pay towards unsecured debt. Almost all plans propose a payment period of three to five years and at no interest for unsecured creditors. After the documents have been filed and the filing fee has been paid, the bankruptcy court will schedule a meeting of the debtor’s creditors, called the Section 341 Meeting of Creditors. The meeting is an opportunity for the Chapter 13 Trustee (a person appointed by the court to oversee your case) and creditors to ask you questions about your property and finances. The hearing for determining whether your plan will be confirmed is called the Confirmation Hearing. It will be scheduled to take place about two months after the Creditors’ Meeting. If you have made timely payments under the plan and if there are no objections, the court will approve the plan. (If there are objections, there will be plenty of opportunity to resolve those objections with either the Chapter 13 Trustee or the creditors). If your plan is confirmed, your creditors are obligated to abide by and honor the provisions of the plan—even if they disagreed with it.

Once you have completed all of the payments required under your plan, and once you have completed all other requirements, such as keeping up on their domestic support payments (child support and alimony) and completing a required course in financial management, you will be forgiven from ever having to pay any of the remaining balances that were not paid in the Chapter 13. In other words, you will receive a discharge of the remaining balances of the debt that you owed at the time that your case was filed. When a debt is discharged in bankruptcy, you are released from further obligations to the creditor, and that creditor is not allowed to make future collection efforts or maintain a legal action against you.

Get Reliable Advice from an Oakland County Lawyer

Knowledgeable Oakland County attorney Ronald S. Siegel has been working with Michigan debtors for many years, creating appropriate solutions for each individual and their family during times of financial crisis. Call us today at 248-646-4600 or contact us online to schedule an appointment to discuss your case. Ronald S. Siegel serves people who need a consumer law attorney throughout the Detroit area, including in Farmington Hills, Pontiac, Southfield, Waterford, Livonia, Dearborn, Flint, Sterling Heights, Roseville, and other communities in Oakland, Wayne, Macomb, Genesee, Livingston, and Washtenaw Counties.

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