Do you need a bankruptcy attorney to help you handle your creditors? Do you have legal questions regarding late payments or collection notices? Should you file bankruptcy to protect yourself during a foreclosure or repossession? Defend your rights by calling Murray A. Duncan, Jr. P.C. and get straightforward questions from a skilled bankruptcy lawyer.
Murray A. Duncan, Jr. is a highly skilled bankruptcy attorney with years of experience in Chapter 7 bankruptcy filings who can help you bring your finances under control.
If you are in debt and considering filing for Chapter 7 bankruptcy in Michigan our bankruptcy attorneys can help you determine whether your situation warrants filing bankruptcy in order to avoid foreclosure or protect your income. A Michigan bankruptcy attorney from Murray A. Duncan, Jr. Law understands that sometimes bankruptcy becomes the only viable option for the individual and family. We can help you get a fresh start.
Our Michigan law firm offers numerous bankruptcy specializations, including:
- Chapter 7
- Wage Garnishments
- Utility Shut Offs
- Collection Calls
Our experienced bankruptcy attorneys recognize that confidentiality and efficient service are important for every client. We assure each and every client that your matter is attended to quickly and remains completely confidential. Our bankruptcy attorneys also realize that this is a serious decision and will provide you with all of the information you need to feel confident in your decisions and in our firm.
Chapter 7 Bankruptcy
The purpose of chapter 7 Bankruptcy is to discharge debts and give the debtor a fresh start. The discharge extinguishes the debtor's personal liability on debts and is only available to individuals, not to partnerships or corporations. Although most individual chapter 7 cases result in a discharge of all debts — some types of debts are not discharged — and a discharge does not extinguish liens on property. In rare cases, chapter 7 may be dismissed as an abusive filing if the court finds an individual has the ability to pay a meaningful dividend to unsecured creditors in a chapter 13 case.
A chapter 7 bankruptcy case begins by filing a petition with the bankruptcy court in the district where the individual lives or where the business debtor has its principal place of business or its principal assets. The debtor is required to file schedules of assets and liabilities, including current income and expenses, and a statement of financial affairs. A husband and wife may file a joint petition, or a spouse may file individually. Joint petitioners pay only one filing fee.
Filing a petition automatically stays most creditor actions against the debtor and the debtor's property. This stay arises by operation of law and requires no judicial action. While the stay is in effect, creditors cannot initiate or continue lawsuits, repossessions, or wage garnishments.
One schedule filed by individual debtors lists exempt property. Federal bankruptcy law provides that an individual [vs. business] debtor can protect certain assets from creditor claims because this property is exempt under federal bankruptcy law or the laws of the debtor's state. Married couples may only claim one set of exemptions.
A bankruptcy trustee is appointed when the case is filed. The trustee's duties are to examine and verify the accuracy of the debtor's bankruptcy papers and to identify assets that are not exempt. The trustee sells the non-exempt assets that have value and distributes the net proceeds to the creditors. If an asset has a loan against it, the debtor can keep the asset if the equity is exempt.
A meeting of creditors is held about 30 days after the petition is filed. The debtor must attend the meeting, and if a husband and wife filed jointly, both must attend. You must bring a government issued picture I.D. and your social security card to the meeting. Creditors may appear and ask questions regarding the debtor's financial affairs and property, but creditors rarely attend. The trustee conducts the meeting, and the debtor must cooperate and provide the records the trustee requests. Otherwise, the debtor could be denied a discharge.
The bankruptcy court clerk issues the discharge, usually a few days after 60 days has elapsed from the first date set for the creditors meeting. A copy of the discharge is mailed to the debtor and all the creditors listed in the debtor's schedules.
A bankruptcy discharge releases the debtor from personal liability and prevents the creditors from taking any further action against the debtor or his property to collect the debts. As a general rule, individual debtors receive a discharge in over 99 percent of chapter 7 cases.
A creditor has two options to oppose the discharge: file a complaint objecting to the debtor's bankruptcy discharge; or file a complaint to determine if the creditor's debt is accepted from the discharge. A creditor may pursue one or both of these remedies by filing a complaint with the bankruptcy court. The time limit for an adversary action is very short, just 60 days from the first date of the creditors meeting, unless extended by court order.
The grounds for objecting to a bankruptcy discharge in a chapter 7 are narrow, and the creditor or trustee objecting to the discharge has the burden of proving the case. In general, the grounds for denying a discharge are: the debtor failed to keep and produce adequate financial records; the debtor failed to explain satisfactorily a loss of assets; the debtor committed a bankruptcy crime; the debtor failed to obey a lawful order of the bankruptcy court; or the debtor fraudulently transferred, concealed, or destroyed property that would have been property of the estate.
Once a discharge is granted, the trustee, a creditor or the U.S. Trustee may later file a complaint to revoke a chapter 7 discharge if they can prove: a) the discharge was obtained through the fraud of the debtor; or b) the debtor acquired property that is property of the estate and knowingly and fraudulently failed to report the acquisition of such property or to surrender the property to the trustee. Generally, this complaint must be filed within a year after the discharge was granted.
Certain types of debts may not be discharged in a chapter 7 such as alimony and child support, most taxes, student loans made or guaranteed by a governmental unit, debts for death or personal injury caused by the debtor's operation of a motor vehicle while intoxicated from alcohol or other substances, and debts for criminal restitution orders. To the extent that these types of debts are not fully paid in the chapter 7 case, the debtor is still responsible for them after the bankruptcy.
Debts for money or property obtained by false pretenses, debts for fraud while acting in a fiduciary capacity, debts for willful and malicious injury to another or to the property of another, and debts arising from a property settlement agreement incurred during or in connection with a divorce will be discharged unless the creditor timely files an adversary complaint. The creditor must file the complaint within 60 days from the first date of the creditors meeting. The presumption is in favor of the discharge, and the creditor normally has the burden of proof to show that such debts should be accepted from the bankruptcy discharge.
Secured creditors normally retain the right to seize their loan collateral, even after a discharge is granted. The debtor must decide whether to keep the asset. If a debtor returns the collateral, and if a discharge is granted, the debtor will have no further liability to the creditor.
A debtor wishing to keep the asset, such as an automobile, may "reaffirm" the debt or redeem the property. A reaffirmation is an agreement between the debtor and the creditor where the debtor promises to pay all or a portion of the money owed. The reaffirmed debt will still be owed after the discharge. In return, the creditor promises as long as payments are made, the creditor will not repossess the automobile or other property. If the debtor defaults on the payments, the creditor may repossess and sell the collateral. Unfortunately, if the sale price is not enough to pay off the debt, the debtor will still owe a deficiency to the creditor.
Contact bankruptcy attorney Murray A. Duncan Jr. if you are fighting with creditors and debtors and may be eligible for chapter 7 bankrupty. You initial phone consultation is always free so call our office today at 734.941.5025.