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Michigan Bankruptcy Questions & Answers
3 Answers | Asked in Bankruptcy for Michigan on
Q: Is purchasing a mattress a month ago going to hinder my ability to file for chapter 7 bankruptcy?

I recently purchased a mattress on a store credit card due to our old mattress catching on fire due to a candle. I am drowning in debt and can’t keep up with payments. I am thinking of filing bankruptcy, Is this going to look terrible that I recently purchased a mattress? I thought I could keep... View More

Robert Chang
Robert Chang
answered on Sep 10, 2024

I am assuming the mattress is not a luxury item as they are not usually seen as splurging money. (especially when your previous one caught on fire). It is something that is needed in your daily life, like electricity and internet access. That being said, if you took out a loan to purchase the... View More

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3 Answers | Asked in Bankruptcy for Michigan on
Q: Is purchasing a mattress a month ago going to hinder my ability to file for chapter 7 bankruptcy?

I recently purchased a mattress on a store credit card due to our old mattress catching on fire due to a candle. I am drowning in debt and can’t keep up with payments. I am thinking of filing bankruptcy, Is this going to look terrible that I recently purchased a mattress? I thought I could keep... View More

Jesse R. Sweeney
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answered on Sep 9, 2024

The answer really goes to intent. Did you plan to file bankruptcy when you purchased the mattress? Had you spoken to counsel prior to purchasing it? Did you make a good faith effort to pay for it? Also the cost of the mattress is important - a $5000 mattress going to cause more issues than one... View More

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2 Answers | Asked in Bankruptcy for Michigan on
Q: I would like to file bankruptcy chapter 7 I'm low income I would have start the process and where do I come
James L. Arrasmith
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answered on Jun 26, 2024

To start the process of filing for Chapter 7 bankruptcy in Warren, Michigan as a low-income individual, here are the key steps:

1. Credit counseling: Complete a mandatory pre-filing credit counseling course from an approved provider.

2. Gather documents: Collect financial documents...
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1 Answer | Asked in Bankruptcy for Michigan on
Q: Annual employment bonus paid a month after filing chapter 7. Disclosed on amended petition. Can any portion be exempted?

and if so, under what code? Using MI state exemptions. Not a gov't/civil employee.

James L. Arrasmith
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answered on Jun 1, 2024

When dealing with an annual employment bonus received after filing for Chapter 7 bankruptcy, you might be able to exempt a portion of it using Michigan state exemptions. Since you’re not a government or civil employee, the regular Michigan exemptions apply to your case.

In Michigan, you...
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4 Answers | Asked in Bankruptcy for Michigan on
Q: Should a joint credit card still be reporting to Experian after a discharged Chapter 7 if only 1 person filed?

1 person filed, the other did not. It's still on both credit reports.

W. J. Winterstein Jr.
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W. J. Winterstein Jr.
answered on Mar 21, 2024

When a debt obligation like a credit card is "joint", e.g., where the non-bankrupt "joiner" has signed an issuer document to be liable for the debt balance, yes, that obligation will continue to be reported to the credit bureaus for both of the joint obligors.

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4 Answers | Asked in Bankruptcy for Michigan on
Q: Should a joint credit card still be reporting to Experian after a discharged Chapter 7 if only 1 person filed?

1 person filed, the other did not. It's still on both credit reports.

James L. Arrasmith
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answered on Mar 24, 2024

When a Chapter 7 bankruptcy is discharged, debts listed in the bankruptcy should be reflected as such on your credit reports. However, joint credit cards represent a shared responsibility. If only one person files for bankruptcy, the other account holder remains responsible for the debt.

If...
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2 Answers | Asked in Bankruptcy for Michigan on
Q: On chapter 7, do I include my father and his Social Security? He pays his own bills and I pay mine
Brent T. Geers
Brent T. Geers
answered on Jul 11, 2024

You should consult with a bankruptcy attorney on this first, but ordinarily, you would need to declare you receive some form of financial assistance or income from him, which is different from the entirety of his social security.

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4 Answers | Asked in Bankruptcy for Michigan on
Q: If a person declares bankruptcy will they lose their house?

Thousands secretly charged on credit card by spouse.

W. J. Winterstein Jr.
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W. J. Winterstein Jr.
answered on Nov 9, 2023

Much of your answer is fact-dependent.

E.g., is your mortgage debt current? Who controls the family finances/checkbook? How much credit card debt has been accrued? Is there equity value in the residence above the mortgage balance?

A Chapter 7 bankruptcy is a so-called...
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2 Answers | Asked in Bankruptcy, Divorce and Family Law for Michigan on
Q: How does marital property work in chapter 13 bankruptcy if only one spouse filed for bankruptcy.

Married in august 2019, brought home September 2019, he filed for chapter 13 bankruptcy in March 2023, he filed for divorce in July 2023

T. Augustus Claus
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answered on Oct 12, 2023

In Michigan, marital property is divided equally between the spouses in the event of a divorce. However, this rule can be modified by the court based on a number of factors, including the length of the marriage, the contributions of each spouse, and the needs of the children. In the case you... View More

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2 Answers | Asked in Bankruptcy for Michigan on
Q: I am nearing the end of a Chapter 13 bankruptcy. I need to convert to Chapter 7, however since I am behind on my payment

I do not have the funds to catch up on the amount that I am behind on the payments. I also am unable to convert because my lawyer says that I must pay her $3000 to do that. I also have no money to pay the $3000. What (if anything) can I do to salvage my case? My case is set to close at the end of... View More

Ralph Reisinger
Ralph Reisinger
answered on Aug 16, 2023

For starters make sure you can convert. If you own your home the house value may have gone up substantially and a conversion may not be possible. If you can convert, shop around, you can always substitute attorney's and there may be someone who can help you for less than the quoted amount.

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1 Answer | Asked in Bankruptcy, Contracts and Health Care Law for Michigan on
Q: When a continuing Care Facility files Chapter 11 does it void the contract which includes return of part of entrance fee

My cousin recently left a continuing care facility that filed chapter 11 two weeks later. Per her contract she gave 60 days notice but moved out in 20. Is she obligated to pay for the remaining 40 days since she probably wont be getting the 90% of her entrance fee back that was promised in her... View More

Brent T. Geers
Brent T. Geers
answered on Jul 18, 2023

A bankruptcy alone does not void a contract. Chapter 11 is a business reorganization. Essentially someone - a trustee - takes over the business, managing its assets and liabilities. Largely, that process does not affect you the consumer.

Think about it: you have likely bought products or...
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2 Answers | Asked in Bankruptcy and Collections for Michigan on
Q: I have roughly 100,000 equity in my house am in disability and have about 20,000 of debt I am having an issue paying

Comb of 3 cc and left over debt from repo car. What are my options I can’t get a home equity loan as I don’t make enough.

Ralph Reisinger
Ralph Reisinger
answered on Jun 19, 2023

It depends on your home value. If the home is worth 200,000 the combination of the State Exemption $69,200 and the liquidation cost of $20,000 would reduce the required payoff to around $10,000. If the house is worth more, the amount you would have to pay in would be less because the liquidation... View More

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3 Answers | Asked in Bankruptcy for Michigan on
Q: If I have equity in my house will I still be able to file chapt 7 bankruptcy?
Ralph Reisinger
Ralph Reisinger
answered on Jun 19, 2023

The question is, can you protect the equity. It depends on your marital status, the type of debt you have and the amount of equity. For example if you are single, and you use the Federal exemptions you can protect up to 27,900 if you use Federal Exemptions or $46,255 if you use State Exemptions.... View More

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2 Answers | Asked in Bankruptcy for Michigan on
Q: Once I sign a reaffirmation agreement, how long does it take the attorney to file it in court?

I signed reaffirmation agreements for my car and a credit card and I would just like to know how long does it take to be filed and received by the court. I know when you file bankruptcy that it is received by the courts pretty quickly so I was wondering if it worked the same way with reaffirmation... View More

W. J. Winterstein Jr.
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W. J. Winterstein Jr.
answered on May 12, 2023

Every Reaff Agreement is exactly that, a mutual agreement between a debtor and the creditor, all subject to approval by the Court.

Authorized signatures of both parties is of course required.

Once aa mutually subscribed Reaff Agreement, with Motion and Affidavit is in hand,...
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3 Answers | Asked in Bankruptcy for Michigan on
Q: I am interested in converting my Chapter 13 bankruptcy to a Chapter 7.

My attorney (the one who is representing me in the Chapter 13), wants me to pay her $3,000 to convert. I do not have $3,000, and I am aware that the court only charges a small ($25?) conversion fee. I understand that she wants to get paid for her work, which is understandable. However, I don't... View More

W. J. Winterstein Jr.
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W. J. Winterstein Jr.
answered on Mar 20, 2023

If you simply cease to make payments to the Ch. 13 Trustee, that office will file its own motion to convert or dismiss, and you can appear at the resulting hearing and express your wishes, which will probably be granted.

It is more problematic if there is a wage garnishment in place that...
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1 Answer | Asked in Bankruptcy, Consumer Law and Foreclosure for Michigan on
Q: I owed SBA disaster loan of $24,000 and then in 2019 I did a chapter 7 due to financial problems, .

The sba loan was discharged, the problems is, everytime I try to refinance my house, they still block the refinance and demand the $24000 , and banks back away.

Is this legal what they are doing or illegal?

What can I do for them cease-and-desist?

Thomas. R. Morris
Thomas. R. Morris
answered on Feb 13, 2023

The bankruptcy discharge prohibits a creditor from demanding payment of a discharged debt. However, it does not require a prospective lender to lend to you. Therefore, it is illegal for the creditor holding a discharged debt to try to enforce it against you, but legal for a bank to deny you a... View More

3 Answers | Asked in Bankruptcy for Michigan on
Q: What to do when attorney was instructed to file paperwork and he did not, causing a dismissal of case ?

Its a bankruptcy case

Edward Gudeman
Edward Gudeman
answered on Dec 23, 2022

Certainly, you should speak to your attorney about filing a motion to reopen the case and obtain permission to file the appropriate documents. He or she should obviously comply with your request. Refiling is also a possibility, but there are factors that might prevent it.

If there is no...
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3 Answers | Asked in Bankruptcy for Michigan on
Q: Trustee objected to exemptions due to me exceeding limits. Should I amend my schedule C? It is for chapter 7

I have 44,000 in equity for my home, I am still paying mortgage, completed reaffirmation agreement that lender sent. The allowed exemption was 27,900. I have the same issue with my car, I do not own, however there is 7,000.00 in equity, the trustee states I only can exempt 1475.00. I am up to date... View More

Cristina M. Lipan
Cristina M. Lipan
answered on Nov 29, 2022

It doesn't mean anything if no one objected. Most creditors don't, but the Trustee may do so for the benefit of all creditors. If you have exceeded your exemptions, amending your schedules won't make any difference (it is a question of fact, not just about what you assert on your... View More

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2 Answers | Asked in Bankruptcy for Michigan on
Q: Would a court typically grant permission to take out a 401k after a job loss?
W. J. Winterstein Jr.
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W. J. Winterstein Jr.
answered on Nov 16, 2022

The working presumption in a Ch. 13 case is that the debtor will retain and manage his assets, and that is set when a Plan is confirmed (there are provisions to modify a plan after confirmation).

There is also a Bankruptcy Code provision that states that a debtor must first procure court...
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2 Answers | Asked in Bankruptcy for Michigan on
Q: Can I withdraw my 401k if im in chapter 13 bankruptcy?
Timothy Denison
Timothy Denison
answered on Nov 16, 2022

Not without permission of the court.

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