Michigan Bankruptcy Timeline
Struggling with debt? Bankruptcy could be the solution.
Repaying unmanageable debt may be, in some cases, a losing battle. Under
these circumstances, it may be necessary for the debtor to rid themselves
of this financial burden once and for all, and ultimately move forward
with a clean slate—which can be done through a
Chapter 7 or
Chapter 13 bankruptcy. Although there are numerous alternatives that can be utilized
to achieve a similar outcome, including debt consolidation, creditor negotiation
and debt settlement, filing for bankruptcy would give an individual the
opportunity to discharge most, if not all, of their debt. When faced with
a dire financial situation, this is often the most practical solution.
For this reason, you should not hesitate to explore your options with
a Michigan bankruptcy lawyer at Hensel Law Office, PLLC if you have found
yourself in a similar situation.
Preparing for Bankruptcy in Sterling Heights, MI
If you have made the decision to file for
bankruptcy in Michigan, you will need to prepare for the process ahead. Although
many people think that it starts when you submit your petition to the
court, it is important to understand that the preparation phase begins
as early as 180 days before filing. For this reason, our firm encourages
you to review the steps below:
Avoid Making Large Purchases: Many people assume that they can spend their money recklessly before filing
for bankruptcy since their debt will soon be discharged. If you make large
purchases or transfer substantial sums of money before filing, however,
the bankruptcy court may think that you are attempting to commit fraud—which
may lead to the dismissal of your case or a denied request for debt discharge.
Take the Means Test: If you are interested in filing under Chapter 7 of the U.S. Bankruptcy
Code, you will need to determine whether or not you are eligible. Since
this process would eliminate most of your debt, it is strictly reserved
for those who are in a dire financial situation. To find out if you qualify,
you will need to take a means test—which determines how much disposable
income you can contribute to repaying debt.
Undergo Credit Counseling: Before filing your bankruptcy petition with the court, you will need to
undergo credit counseling within the preceding 180 days. The course must
be government-approved, as you will need to include a certificate of completion
with your petition. This 90-minute course will help you to evaluate your
financial situation, review some of the possible alternatives and create
a personal budget plan.
Initiating & Completing the Bankruptcy Process
Once you are adequately prepared to file for bankruptcy, you can submit
your petition with the court. It is important to understand that it may
take several months to receive a discharge of debt, but you will be able
to enjoy the protections of an automatic stay during that period of time.
The bankruptcy timeline will subsequently continue on as follows:
Automatic Stay Will be Ordered: Once your petition has been approved by the court, they will move quickly
to order an automatic stay. This order will subsequently prohibit all
creditors from continuing their collection efforts—which means that
the foreclosure process will be halted, collection agencies will be barred
from contacting you and your wages will not be garnished.
Creditors Will be Notified: Approximately 7-10 days after you have filed, the court will notify all
creditors of the bankruptcy by mail. You will also receive notice of when
you will need to appear in court—wherein you will need to decide
what debts you will continue to pay. If any of your creditors wish to
dispute the impending discharge of debt, they would have 60 days to do so.
Meeting with Creditors Will be Held: Approximately 30 days after filing, you will need to submit paperwork to
the court indicated which debts you will continue to pay. Immediately
after, you will be required to appear in bankruptcy court and meet with
your creditors—if they choose to appear. This will start the discharge
process, unless a creditor disputes a particular debt.
Applicable Debts Will be Discharged: Approximately 60-90 days after your bankruptcy hearing, all applicable
debts will be discharged. This may take longer if a creditor wishes to
dispute the discharge of a particular debt, but you can expect to find
relief within a few short months. Once the process has been concluded,
you would no longer be protected by the automatic stay.
Still have questions? Call for a free consultation!
Still have questions about the bankruptcy timeline in Michigan? The legal
team at Hensel Law Office, PLLC has the answers. We are available to sit
down with you and discuss your case—whether you have already made
the decision to file for bankruptcy or you are interested in finding a viable
alternative—so you should not hesitate to take the first step today. All you
will need to do is contact our office at (888) 258-0651 to take advantage
of a free initial consultation. After that, we would be more than willing
to meet you on the weekend or in the evening, but it is up to you retain
the help that you will need.
Contact the Michigan bankruptcy attorney at our firm today to get started.