Chapter 7 Bankruptcy
WHAT IS CHAPTER 7 BANKRUPTCY?
Chapter 7 Bankruptcy is often referred to as a “fresh start” bankruptcy. The reason is most (but not all) unsecured debts are discharged (ie eliminated) such as:
Our philosophy is that it is more important to feed your family and pay your mortgage/rent than it is to service a garnishment or a bank levy. Everyone is entitled to a safety net now and then.
CHAPTER 7 BANKRUPTCY RULES: 4 STEPS TO A DEBT FREE LIFE
When filing a Chapter 7 Bankruptcy, there are certain steps that every Michigander must go through. They include:
STEP 1
FREE NO OBLIGATION CONSULTATION
(30 MINUTES TO 1 HOUR)
The consult can be done in person, by phone or FaceTime/Skype. If Chapter 7 Bankruptcy makes sense for you, we will sign you up during this consultation. This takes only minutes.
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We will then help you with the worksheets (we never send you home with a pile of forms you do not understand) and we pull your credit report. |
STEP 2
REVIEW AND SIGN APPOINTMENT
(2 HOURS)
At your review and sign appointment, you will meet with our staff and your bankruptcy attorney to make sure the information on the petition and schedules is complete and accurate. You sign and we file your Chapter 7 Bankruptcy within a day or two of this meeting.
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Upon filing, creditor collection activity must stop-by law. |
STEP 3
MEETING OF CREDITORS
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Firebaugh & Andrews is with you as a bankruptcy trustee asks that you verify the information on the bankruptcy schedules is true, correct, and complete. The questioning typically lasts 5-10 minutes and typically creditors do not appear. |
STEP 4
DISCHARGE ORDER
A discharge order will be entered. The discharge eliminates your liability on the debt listed and all creditors are barred, by law, from collecting on the debt in the future.
WHO CAN FILE CHAPTER 7 BANKRUPTCY?
The United States Bankruptcy Code sets the qualifications for who can file a Chapter 7 Bankruptcy. They are:
Firebaugh & Andrews will make sure you qualify to file Chapter 7 Bankruptcy in Michigan. Remember, bankruptcy is not just what we do, it’s ALL we do
ADVANTAGES/DISADVANTAGES OF CHAPTER 7 BANKRUPTCY
ADVANTAGES TO FILING A CHAPTER 7 BANKRUPTCY IN MICHIGAN
- You get your life back in 4 months.
- The only debt you continue to pay is either for things you want to keep-like your home or car or debts excluded from discharge under the code (like child support or student loans).
- Credit improves because you have less debt than before.
- Collection activity stops including garnishments, levies, foreclosures, and repossessions.
- There is no minimum debt requirement.
- Most people lose no assets.
DISADVANTAGES TO FILING A CHAPTER 7 BANKRUPTCY IN MICHIGAN
- Can only be filed once every 8 years.
- Co-signors are still liable for co-signed debt.
- A small number of clients lose non-exempt assets to a Chapter 7 trustee.
BANKRUPTCY FEES & COSTS TO FILE
Chapter 7 Costs: $375 – Includes filing fee, credit counseling courses and credit report. These costs must be paid prior to filing.
Chapter 7 Attorney Fee: $0 Down and easy payments of $100-200 per month. Payment on our fee does not start until after you filed.Promissory note required if fees not paid in full.