Welcome to Michigan-Bankruptcy.com

Call or e-mail my office for a free startup package 1-888-4Walter or 313-962-4656   

I have personally helped thousands of people get a fresh start debt free with Chapter 7 Bankruptcy or develop an affordable repayment plan in Chapter 13.  I charge among the lowest fees in metro Detroit.  Call around and compare.

I take pride in preparing each case myself to assure the job is done right and I represent my clients personally in Court (other attorneys hire people to go to court for them). I see to it that my clients obtain the full relief the United States Bankruptcy Code can offer them.

I vigorously protect my clients rights and protect them from creditor abuse. I have helped many families and individuals overcome the stress that financial problems can cause. My expertise always results in savings that far outweigh the amount of legal fees in a case.

       Should I File Bankruptcy?       

The process of deciding whether to file a bankruptcy proceeding often is very difficult indeed. Nobody wants to file bankruptcy, whether it be under Chapter 7 or Chapter 13 of the Bankruptcy Code. Bankruptcy is meant for the honest debtor, someone who has explored all alternatives. (see below) A bankruptcy may have adverse credit effects and there can be other undesirable ramifications. Well then, why should someone take this important step? The answer to that question, in my opinion, is that you should file only after considering the various possible alternatives. If none of these alternatives is feasible or practical for you, then filing a bankruptcy petition may be the most responsible step to take.

 A Story for those Feeling Guilty about Bankruptcy

Thomas Jefferson. The third president of the United States. A statesman, diplomat, architect, author, inventor and farmer. Widely acknowledged as a genius and the smartest of all U.S. presidents. A man who gave vision to this country as one of its founding forefathers and leader of this country.

Why do I bring up Mr. Jefferson? Because he was almost constantly in debt. A whole lot of debt. Mr. Jefferson filed several bankruptcies in his lifetime; and, his debt was huge in comparison to most individuals' bankruptcies today.

The point is, bankruptcy is nothing to be ashamed of. If a person with Mr. Jefferson's credentials, aptitude and intelligence can get himself into situations, repeatedly, that require bankruptcy to solve, then it is certainly no negative reflection on you if you need to. Many famous and important people have exercised their right to file Bankruptcy including Willie Nelson, Jerry Lewis and former Treasury Secretary John Connally.

Most people who file bankruptcy would much rather repay their debt if they could, and they must deal with their ingrained fear of bankruptcy, because mis-informed societal attitudes have always looked upon bankruptcy debtors as cheats, criminals and irresponsible. Many clients insist upon telling me of their exemplary past credit history, even though it has little to do with their present predicament, and offers me no information necessary to help them now. I suspect the reason arises from a need to explain that their situation is different, because they are not cheats and criminals like others who may file.

The irony is that they really are just like most others who file. It is simply a myth to believe that most people who file bankruptcy could pay their debts if they chose. The fact is most bankruptcy debtors have sold valuable assets to repay debt, borrowed from friends and relatives, and have simply no other place to turn before looking to the bankruptcy code for debt relief.

The most common reasons for filing bankruptcy include loss of employment, insufficient medical insurance, divorce, or a failed business venture. Most recently, bankruptcy filings have been surging as a result of the unprecedented availability of high interest credit cards, which inevitably lead to a greater number of defaults when combined with any of the above problems.

The inability to keep current with bills as they become due causes stress that affects marriages, jobs and almost every aspect of life. Anyone who has suffered from a barrage of hostile telephone calls from bill collectors knows that something has to give. The bankruptcy laws have been enacted to provide a safety valve that gives honest people a fresh start, and helps them regain normal lives.

While there is little reason to feel happy about filing bankruptcy, you shouldn't feel like a loser either. If you are going through a financial crisis you are not alone. Over a million people a year turn to the bankruptcy laws for debt relief. Statistics show that the cross section of individuals and couples filing bankruptcy mirror society as a whole by income, type of employment, home ownership and almost any other relevant category. In other words, anyone can find themselves in bankruptcy.

Bankruptcy is a Right and a Privilege provided to you 

by the United States Constitution

The bankruptcy laws are there for a reason. On the whole, they benefit both the debtors and creditors. It is of course important to be responsible for the debts you incur, but filing a bankruptcy IS an act of responsibility. It puts you in a position to move forward, to become productive once again, provides closure, and pays your creditors from your non-exempt assets (or by other means if the court so approves in a Chapter 13 or 11 context).

It is important to seriously explore bankruptcy as an alternative to struggling for years to no avail. There are many factors to consider before filing a bankruptcy, but one of them should not be a guilty conscience.

   Recognize any of these Warning Signs?

Warning Signs. In assessing whether or not you should seek some kind of debt relief, consider the following questions:

• Do you ever use one form of credit, such as a credit card or debt consolidation loan, to make payments on other debt? Or to put it in Biblical terms "Robbing Peter to Pay Paul"?

• Have you taken one or more cash advances greater than $500 in the past few months to pay living expenses such as everyday utility bills or even groceries?

• Do you ever borrow from friends or family to meet regular expenses, such as food and utility bills?

• Can you barely make the minimum required payment on credit cards or other debts?

• Are you receiving harassing calls or letters from creditors or collection agencies?

• Are you being sued (summons and complaint), or are your creditors threatening to sue you?

• Are your wages being garnished, or are your creditors threatening a garnishment?

• Are your financial problems impacting your health or relationships due to stress?

• Do you owe two months salary or more on your credit cards?

• Are you using one-quarter or more of your take-home income to pay credit card bills and personal loans (excluding mortgage payments)?

• Are your revolving credit cards charged to the limit or maxed out?

• Have you bounced more than one check in the past year?

• Are you without cash reserves for a rainy day or emergency?

• Are you behind on house (mortgage or rent) or auto payments?

• Are your creditors threatening to take your car, house, or other property (foreclosure or repossession)?

• Are you behind on your taxes or do you owe the IRS, State of Michigan or City of Detroit?

If you answered “yes” to one or more of the preceding questions, you should consider seeking some form of debt relief. Bankruptcy, of course, offers very effective debt relief, but there are possible alternatives to filing bankruptcy which shall be covered below.

   Certain basic concepts apply under both Chapter 7 and Chapter 13. The case is commenced by filing a petition with the bankruptcy court. The petition must list all of your assets, liabilities and other information required under the code. You cannot pick and choose which creditors to include on the petition, but that doesn't mean you cannot keep your home or vehicle, as will be explained later. All creditors must be listed. You may file as an individual or as husband and wife. Married couples do not have to file together if substantially all debts are solely in one spouse's name.

Your creditors can force you into bankruptcy. This is called an involuntary proceeding. For the most part, involuntary proceedings are confined to business cases. Almost all consumer cases are filed voluntarily. Approximately 75% of the cases I file a Chapter 7 "wipe-out debt" cases, the other 25% are Chapter 13 "reorganization or repayment plans" in which the debtor (or husband and wife) make payments to a Chapter 13 Trustee for a 3 to 5 year time period. Most Chapter 13 cases I file are for debtors who are trying to prevent a foreclosure of their home or repossession of their vehicle.  Some Chapter 13 cases are filed because the debtor's are not eligible to file a Chapter 7 either because they have filed a prior Chapter 7 in the previous six year or they have too many assets or make too much money or because they could pay their creditors a good percentage of what they owe with a Chapter 13 plan without too much of a burden on their way of life. Some clients will file a Chapter 13 repayment plan even if they qualify for a Chapter 7 just because they want to pay their creditors. Both Chapter 7 and Chapter 13 will stop creditor action such as a foreclosure or sheriff's sale, utility shut-off, vehicle repossession or wage garnishment. See below or link to my detailed frequently asked questions page for answers to more of your questions.  Feel free to e-mail me, come in to see me for a free consultation or call me locally at (313) 962-4656 or toll free at 888-Debt Gone or 888-4Walter.

The filing of the petition invokes what is known as the automatic stay. This means that your creditors are immediately prevented from doing anything further to compel collection of a debt. The harassing calls, garnishments, law suits, foreclosures, repossessions or shutting off of utility services are all stopped. The "stay" is designed to give you time to sort out your affairs free from the harassment of creditors.

In the petition, your debts are classified as either priority, secured or unsecured. Each is treated differently depending on which chapter is filed. Priority debts in consumer cases are usually limited to government tax liabilities and support obligations. Priority creditors have certain rights to payment over other creditors.

Secured debts are backed by property known as collateral, and typically consist of auto loans and mortgages. The creditor has a lien, or right to recover the property upon default. In most cases, liens attach to property by virtue of a written security agreement signed when the pledged property is purchased, or upon obtaining a loan.

Unsecured debts are almost everything else. They include credit cards, back utilities, medical bills, store charges and unsecured loans. Unsecured creditors do not have a lien or interest in your property. If you purchased certain property with a store charge or credit card, the seller cannot repossess that property on your default without a security agreement.

Alternatives to Bankruptcy

Generally speaking, the chief alternatives to bankruptcy are some form of negotiation and settlement with one or more of your creditors, perhaps by making payments through a nonprofit credit counseling service. Anytime you are dealing with alternatives to bankruptcy, be sure that you do not “put all your eggs in one basket.” In other words, do not let a foreclosure sale occur or allow a judgment to be entered against you without first finding out your options under bankruptcy laws.

Nearly all large companies such as credit card issuers have limited or no resources for dealing with individual borrowers. Many of my clients relate to me that they have called and written to their creditors to attempt to work out a method of paying their debts. Most often, these people find that no matter how good their reason for wanting to work out their debts, and no matter how hard they try to pay their creditors what they can afford, the creditors simply will not “work” with them. This is because these creditors are vast bureaucracies that have no method and no personnel to deal with people on an individual basis. There are some limited exceptions, however. If your situation is like one of the following, you may want to try to work the problem out without filing bankruptcy:

• Deed in Lieu of foreclosure. If you have one mortgage on a home or other piece of real estate and you cannot sell the property and simply wish to relieve yourself of the mortgage obligation, it is possible that you can negotiate a “deed in lieu of foreclosure.” This is an agreement where you give the property to the creditor, who, in turn, releases you from the debt. This saves the mortgage company the cost of foreclosing against you and allows you to walk away from the debt without further responsibility. You can try to negotiate this on your own, or you can hire an attorney to do it for you. Generally, mortgage lenders will not agree to this arrangement unless there is some equity in the property or the property is at least worth the amount that is owed. The mortgage holder will not accept the property if there is any other debt on the property, such as a second mortgage or a judgment lien.
  
  It is important to note automobile lenders most often will not release you from the debt upon surrender of the vehicle. You can expect that following the surrender, the vehicle lender will seek to collect the deficiency (the amount of the debt remaining after sale of the vehicle.)
  
  

• Re-amortization of Past-Due Mortgage Balance. If there is a good reason why you fell behind in payments (such as temporary job loss, illness, or injury), a mortgage holder will sometimes consider adjusting the mortgage so that the past due amount is added in to the total and the term of payments is extended (maybe they will put the payments at the end of the loan). The creditor will generally consider this only where your debt-to-income ratio is acceptable and there is no other mortgage debt that is in arrears.
  
  

• Negotiation of a Single Debt. If there is just one (or a few) old debts you are trying to “clean up” on your credit report, it is possible that the creditor or its collection agency will be willing to settle their debts with you for significantly less than the total amount that you owe. This is usually only true of older debts, which may have been bought from the original creditor by another company . Again, you can negotiate a settlement yourself, or hire an attorney to assist you and represent your interests. I usually don't do this because I've found it to be of little help to my clients unless they can afford to pay the creditor right away with a lump sum of money such as after getting a tax refund. Bankruptcy is usually simpler, quicker, cheaper and easier on my clients mental health.
  
  

• Credit Counseling Services. Credit Counseling services can sometimes help, although most of my clients who have tried have failed and eventually just filed Bankruptcy. There are a number of nonprofit credit counseling services available in the yellow pages under “credit counseling.” These services negotiate with your creditors to the extent that they are able. Generally, they can negotiate more favorable terms only with unsecured creditors (debts for which there is no collateral), such as credit card issuers. The credit counseling service attempts to get your unsecured creditors to settle for less than the full amount of the debt that you owe, and also tries to get the creditors to give you a lower interest rate. Some credit card companies will agree to these types of terms so long as they are getting their payments through the credit counseling service. However, other creditors are simply unwilling to work with credit counseling services, and the credit counseling service has no way in which to force the creditors to work with it. To be sure that you are selecting a reputable firm, be sure to ask whether or not you will be held responsible for late charges or other fees if the service does not make their monthly distributions on time. You can also ask for references from current or former clients. Unfortunately Credit Counseling Agencies have no real POWER to deal with your creditors.  When you file a bankruptcy the ball goes into your court.
  
  

• “Mortgage Assistance” Companies and other Scam Artists. Unfortunately, there are a growing number of companies that send advertisements to people with pending foreclosure actions. These “mortgage assistance” companies, who get your address from the court records, promise that they can stop your foreclosure and help you avoid a bankruptcy. Please be very careful of these companies. The vast majority of the time, these companies simply prey on people who are in a desperate situation, taking advantage of your desire to keep your home and “avoid bankruptcy.” Typically, the “mortgage assistance” company will require a payment (usually one or two month’s mortgage payments) and will promise to obtain another mortgage loan to pay off your existing loan or to negotiate with your mortgage company to stop the foreclosure. They will wait until just before (unfortunately sometimes AFTER) the foreclosure sale to tell you that they were not able to help you, and that you should see a bankruptcy attorney. At that point, sometimes it is too late. You will be referred to a lawyer who has a good “working relationship” with the company, to whom you will need to pay even more money.
  
  If you choose to use one of these firms, be sure to ask for references of clients that for whom the company has been successful, and check these references. Also, do not put all of your hopes on this type of service until it is too late to file a bankruptcy that will stop the foreclosure.

• "Do Nothing".  Your financial life may be so destitute that even if creditors got a judgment against you, it would be worthless. If you are older and receiving pension and/or social security and don't own many assets, you may be "judgment proof".  You'll probably still have to deal with creditor calls for awhile.

Filing Bankruptcy (this is where I help)   

Of course, often it is not possible to satisfactorily negotiate a settlement with your creditors. Perhaps your credit card debt or other unsecured debt is overwhelming, with no reasonable prospect of ever paying it back. In this situation, the most responsible step to take for you and your family may be to obtain a financial “fresh start” through a Chapter 7 Bankruptcy . Or, if your mortgage company has started a foreclosure of your home or your vehicle has been seized, the possibility of working this out with your creditor is very slim. In this case, you will have to file a Chapter 13 Bankruptcy to save your property.

Should I File Under Chapter 7 or Chapter 13?        

You must ultimately decide for yourself whether filing bankruptcy is the proper action to take, and if so, which Chapter is better for you. Some of the factors to consider are as follows:

• If you are not making more money than you need for your current living expenses (you have no “disposable income”), Chapter 13 is not a realistic option.

• Chapter 7 has the advantage of wiping the slate clean and enabling you to embark on your “fresh start” immediately. With Chapter 13 you will be making payments for three to five years.

• If you have a particular asset that you want to keep and that is valued above the allowable exemption then Chapter 13 may be the only alternative. For example, if you own a house with significantly more than $25,000.00 in equity and you don't want to lose it, Chapter 7 probably will not work.

• If you are trying to ward off a repossession or a foreclosure, Chapter 7 will not help you, and you will need to file a Chapter 13.

• If your debts are primarily consumer debts, and if your budget reveals that after filing bankruptcy your income substantially exceeds your expenses, it is possible that the United States Trustee could file a motion to dismiss the Chapter 7 case for “substantial abuse.” In such a case Chapter 13 may be the better alternative.

Chapter 7 is commonly known as straight or liquidation bankruptcy. Under this chapter, you are seeking to have your debts discharged, which means the legal obligation to pay creditors is canceled. You can pay all or some creditors after bankruptcy if you feel morally obligated, but is not legally required. You can file Chapter 7 no more than once every 6 years.

Certain types of debts are non-dischargeable. With some exceptions, they include student loans, taxes, alimony and child support, fraudulent debts, debts for embezzlement or larceny, debts incurred from purchasing luxury items or for taking large cash advances shortly before filing, fines and penalties, debts incurred as a result of a willful or malicious injury, unscheduled debts and debts denied discharge in a prior bankruptcy.

Secured debts are fully dischargeable but you may lose the collateral because valid liens survive bankruptcy, and the creditor is free to repossess or foreclose on the collateral once the bankruptcy case is concluded. If you want to keep the collateral you must reaffirm the debt. Reaffirmation means a legal re-obligation to pay the debt as if the bankruptcy never occurred. In exchange for reaffirming the creditor will allow you to keep the pledged property because the creditor is assured payment. Reaffirming requires that you sign a written contract that is filed with the court. You will most likely want to reaffirm on your home and automobile, but not charge cards or other debts unless there is good reason.

Once your petition is filed, a trustee is appointed to represent the best interest of your creditors. The trustee is given broad power under the law. He can set aside improper transfers of property, and can even recover money paid to creditors shortly before filing. The trustee makes sure that all creditors are treated fairly and equally in the bankruptcy proceeding.

Most importantly, however, the trustee is responsible for collecting and liquidating certain valuable assets at a bankruptcy sale. Your creditors are notified of the sale and have an opportunity to bid, or object to someone else's bid. Sale proceeds are distributed to creditors based upon the classification and priority of their debt. Any money left over is returned to you after creditors and administrative expenses are paid.

 

The trustee theoretically has an interest in all non-exempt assets you own up to the date the petition is filed. These assets, as a group, are called the bankruptcy estate. With limited exception, property you acquire after filing does not become part of the bankruptcy estate, and can not be taken by the trustee.

 

Does this mean you lose everything? Not at all. In most cases, your valuable property is either secured or exempt. Much of your other property, as a practical matter, may not be worth the expense of conducting a sale. A typical rule of thumb is that property with a value of less than $1000 will not be sold by a trustee.

 

The laws allow you to keep certain property above any liens or encumbrances to preserve your ability to live. These are called property exemptions. Exempt property, up to certain value limits, includes your home, vehicle, furniture, appliances and various other personal possessions. A complete list of exempt property is found under this site on the Assets & Exemptions page.

Can the trustee sell secured property? If the trustee sells secured property, he must first pay off the lien. Therefore, the trustee will not sell any secured property that at a minimum does not exceed the value of the lien. Therefore, if you can afford the payments on the secured debts, you can reaffirm with the creditor to keep the collateral if you choose.

For this reason, most people can keep their home and automobile, as there is usually limited equity in such property. A home, for example, may have a secured mortgage which leaves little or no equity in the property. Equity is further eroded if you deduct 10% of the home's sale price as an estimate of closing costs. In New York, a husband and wife can exempt up to $20,000 of equity in their home.

As long as equity does not exceed the exemption amount, the trustee is left with nothing to distribute to unsecured creditors if the property were sold. Therefore, the home has no value to the bankruptcy estate, and the trustee will not sell the property. The same holds true for a motor vehicle with equity less than $2,400.

Approximately 45 days after filing the petition, you are required to attend a meeting, known as the Section 341 first meeting of creditors. There, the trustee will determine whether there are assets to be liquidated, or whether there has been any improper conduct affecting your case. There is usually only one meeting, but occasionally a second meeting is scheduled if further information is needed. Your creditors are free to appear and ask questions as well, but creditors rarely attend. The length of the meeting may vary. It usually takes no more than an hour for all scheduled cases on the calendar to be completed.

Approximately two months after the meeting date, the court issues the discharge order signifying the conclusion of the case. The two month waiting period is designed to allow the trustee or a creditor enough time to file an objection to dischargeability, if appropriate. These objections to discharge are known as adversary proceedings, and are usually based on some alleged fraudulent activity. The U.S. Trustee's office, a branch of the Justice Department, can also object if they find that there has been a substantial abuse of the bankruptcy laws. The vast majority of cases, however, will be concluded without objections, and honest debtors should have nothing to fear.

The average case is completed in three to four months. You then have a fresh start, free from the harassment of creditors. While your creditors will not be paid after discharge, some can treat the discharged debt as a loss on their income tax return.

Chapter 13 is known as the wage earner or repayment plan bankruptcy. You can think of Chapter 13 as a debt consolidation, where you group all your debt together, and repay creditors over three to five years through an installment payment plan formulated with the help of your attorney. Chapter 13 can be filed more often than Chapter 7, as long as it is filed in "good faith".

The main advantage of filing under Chapter 13 is that your property is not liquidated by the trustee as in Chapter 7. You keep all of your property as long as you comply with the plan. But you are not completely discharging your debt. You must pay your creditors a percentage on the dollar established in accordance with your assets and ability to pay.

Not everyone can file under Chapter 13. For instance, there is a debt ceiling, or limit to the amount of debt you can have. Total secured debt cannot exceed $750,000, and unsecured debt cannot exceed $250,000.

The plan must also be feasible. To be eligible, you must have regular income such as wages, pensions, self-employment or other income sufficient to fund the plan. The plan cannot run longer than five years, and you must show the court that you have enough disposable income to pay your plan payments within that time.

Corporations cannot file under Chapter 13, and must use the more complex and expensive Chapter 11 bankruptcy if they wish to reorganize. A business proprietor that is not incorporated, however, can file under Chapter 13 provided the debt ceiling and other provisions under Chapter 13 are met.

The Chapter 13 Trustee acts as a disbursing agent. He collects your installment payments, and distributes them to creditors according to the plan.

All creditors may not be fully paid. Unsecured creditors, in many cases, may be paid only a small percentage on the dollar, and upon successful completion of the plan the remainder of their debt is discharged similar to Chapter 7.

To determine how much of your creditors will be paid in Chapter 13, the bankruptcy code provides two guidelines which determine the minimum amount unsecured creditors must receive through the plan. First, the disposable income test requires that you pledge all of your disposable income into the plan for at least a three year period of time. Disposable income is your monthly income after your monthly living expenses are paid. In other words, you must pay unsecured creditors as much as you can afford for at least three years.

Second, under the Chapter 7 test, you must pay unsecured creditors the same amount through your Chapter 13 plan as they would get had your property been liquidated under Chapter 7. Put another way, your plan must pay unsecured creditors an amount equal to the value of your non-exempt property.

Let's take an example. Assume we have a husband and wife owning a home with $30,000 worth of equity. Remember, only $20,000 worth of equity can be exempted. That leaves $10,000 worth of equity which, theoretically, would have been distributed to unsecured creditors if a Chapter 7 petition were filed. So, under the Chapter 7 test, this means that unsecured creditors must receive a total of $10,000 over the duration of a Chapter 13 plan. Now, let's assume there is $14,000 in total unsecured debt. By dividing $14,000 into the minimum $10,000 to be paid, you arrive at the percentage to be paid to unsecured creditors. 10,000 divided by 14,000 equals 0.71 or sevently-one cents on the dollar.

What about priority and secured debts? In every case, your plan must pay priority creditors in full. Also, secured creditors are entitled to be paid an amount equal to the value of their collateral. The difference between the value of the collateral and the balance of the note is the unsecured portion of the debt, and is grouped together and paid the same percentage as the other unsecured debts such as credit cards.

You must also provide for a trustee commission of approximately 5% of the total debt paid through the plan.

A simplified Chapter 13 Plan would look like the chart below. Let's assume this debtor owes $1,500 in back taxes, has $12,000 in credit card and other unsecured debt, and has a $6,000 loan secured with a car having a value of $4,000. also, let's assume this debtor has no non-exempt equity and very little disposable income, which makes this debtor eligible to pay the minimum five cents on the dollar to their unsecured creditors.

Similar to Chapter 7, in Chapter 13 you must attend a Section 341 meeting of creditors, held within 45 days of the filing. Unlike Chapter 7, however, the meeting is followed by a confirmation hearing. At the confirmation hearing, the plan is presented to a bankruptcy judge for his review. If there are no objections, and the plan meets the requirements of Chapter 13, then the judge will confirm the plan, which makes it binding upon creditors.

The first payment under the plan is due approximately 30 days after filing the petition. Thereafter, the payments must be made regularly under the terms of the plan. Debtors can make payments to the trustee themselves, or for convenience, the payments can be deducted directly from their wages.

Chapter 13 may have some advantages aside from allowing you to retain property which is otherwise non-exempt in Chapter 7. For instance, your co-signors are protected if the co-signed debt is paid in full through the plan. Delinquent mortgage payments, back property taxes and missed car payments can be paid through the plan to stop foreclosure or repossession.

Chapter 13 is commonly used to save a home from foreclosure. Under the code, a plan which proposes to pay all mortgage arrears through the plan can decelerate a mortgage default. You must, however, have enough disposable income both to fund the plan, and to start making the current mortgage payments once again directly to the lender as they become due after the petition is filed.

You can pay student loans, child support arrears or restitution through the plan, and some debts which are non-dischargeable in Chapter 7 may be partially dischargeable as an unsecured debt in Chapter 13.

When bankruptcy is appropriate, it is usually not a question of maintaining good credit - your credit standing is probably already damaged. Judgments, delinquent payments, and credit counseling services are reported to the credit agencies for long periods of time like bankruptcy. Few lenders give credit under those circumstances anyway, and even if you satisfy a judgement it still is a part of your credit history.

The credit reporting bureaus report a Chapter 7 filing for a period of almost ten years. The credit bureaus report a Chapter 13 filing for almost seven years as long as you successfully complete the plan. If the plan is dismissed, then the Chapter 13 will be reported for ten years as well.

A fresh start allows you to re-establish your damaged credit. Aside from being reflected on your credit report, the bankruptcy laws do not restrict you form obtaining credit after the case is completed. Keep in mind that whether you have good or bad credit is always a subjective decision in the eyes of a prospective creditor. Of course, you must be prepared to explain why it is necessary to file if a prospective creditor should inquire. Maintaining a good "track record" after filing will minimize the adverse impact of the financial troubles leading to the bankruptcy. With the right strategy, you can build good credit once again. Our office provides a booklet free of charge to each client explaining how to re-establish credit after bankruptcy.

There may be some "pre-filing" strategies to re-establish credit. A non-filing spouse's credit report is not affected by the bankruptcy unless the spouse is a co-signer on any of the debts. If only one spouse files then the other may be able to maintain a good credit standing. Also, if there is a bank card or line of credit with a zero balance before filing, you may be able to use the card after filing, provided it is not revoked by the creditor.

If you are looking for a Bankruptcy Attorney, find out and ask:

1. Is the attorney you talk to at the Office personally going to Court with you? Warning: Many Bankruptcy lawyers just shake your hand and send your file to a paralegal for processing. Later, an attorney you never talked to before shows up in Court. I, Walter Metzen, feel that no matter how simple the case may appear, my clients deserve to have the attorney who they hired, personally go to Court with them.

2. Beware of unlicensed bankruptcy petition preparers who are basically practicing law without a license and often give harmful and damaging misinformation to innocent people already in financial trouble. The United States Trustee's Office is doing its best to investigate and prosecute individuals preying upon Metro Detroit Michigan homeowners facing foreclosure. Beware of solicitors coming to your home and sending offers in the mail. Talk to a qualified attorney. One who will personally go to Court with you.

Acceleration clause - A provision in a contract which allows a creditor the right to immediately demand repayment of the entire amount of a debt upon a debtor's default.

Adversary proceeding - An action brought in the bankruptcy court primarily to determine the dischargeability of a specific debt, or objecting to the discharge of all debts.

Answer - A document issued by the defendant in a law suit stating the legal defenses to the plaintiff's summons and complaint.

Bankruptcy - A condition where a debtor cannot pay debts now or as they become due, and uses the protection of the law to reorganize their financial affairs by liquidating certain property or formulating a repayment plan.

 Oddly enough, it costs money to go Bankrupt.

You are responsible for the court filing fee, which is currently $185.00 for Chapter 13 and $200.00 for Chapter 7. This pays for part of the governmental costs for running the Bankruptcy Courts and for mailing the Notice of Commencement of Bankruptcy and your eventual Discharge letters to you the debtors and your creditors. An Administrative fee for the Chapter 13 trustee come out of your repayment plan and well as any post-filing attorney fees. The Chapter 7 trustee is paid out of your filing fee, and also receives a commission from the sale of your assets, if any (this is rare and I will advise you).

You must pay your own attorney fees which can vary, depending on the case. You have the right to discuss fees with your attorney to reach a clear, understanding of how much it will cost. Other incidental charges may include real estate appraisals or judgments search fees.

As part of the basic services covered under your legal fee, you should expect to receive written materials to help you prepare for the creditors meeting, quick filing of your petition, and personal representation at all Court hearings. These are important considerations that should not be over looked when deciding upon an experienced bankruptcy lawyer.

I pride myself in offering quality Bankruptcy Legal Services while charging reasonable attorney fees.  The following reflects the fees I charge for most cases. Some cases involve substantial attorney time or particular expertise.

The fees and costs below apply to most Individual or Joint (husband & wife) cases. 

Free yourself from the CHAINS of Credit Card Debt      

It is very difficult to get rid of, or discharge, student loans in bankruptcy.  You may be able to change your payment, or get a deferment, or get a discharge outside of bankruptcy court. Here are some telephone numbers and websites where you can find some additional information. Telephone Numbers PHEAA Loan division, discharges, renew eligibility 800-233-0751 Loan Defaults 800-692-7392 Marlene Yakowicz, Closed School Discharges 717-720-3294 Connie Erdman Enders, False Certification (by School) 717-720-2176 Kim Bower, reasonable/affordable agreements 717-720-2860 USED Loans held by (this is a contractor) 800-621-3115 USED information on all types of loans 800-4FED-AID USED consolidation loans (contractor) 800-557-7392 Web Addresses Direct Consolidation Loan calculator: Enter your current balance and income, and the page calculates monthly payments under Standard, Extended and Income Contingent Plans. http://www.ed.gov/DirectLoan/RepayCalc/dlentry2.html Closed School List: Find out if a school closed, and the official closing date. http://www.ed.gov/BASISDB/SCHOOL/search/SF Download loan cancellation application forms (closed school, disability, false certification) http://www.ed.gov/officex/OPE/DCS/forms/index.html US Department of Education Resources

Whatever the situation that you are struggling with, I hope that the information in my website will be helpful to you. If you wish to discuss your situation with me, I would be pleased to do so. You may contact me either by telephone or by e-mail, as follows:

• Call me at 313-962-4656 or DOWNLOAD MY BANKRUPTCY QUESTIONNAIRE WITH THE LINK BELOW
                                     

  Call me at 888-4WALTER or 888-DEBTGONE

• E-mail me at 8884walter@sbcglobal.net

              

Whatever method you use, your consultation will be confidential and free of charge.

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You may obtain more information by contacting my office by telephone at 1-888-4walter or by e-mail to 8884walter@sbcglobal.net or you may link to my other site at www.detroitbankruptcylawyer.com