Bankruptcy Explanations

Chapter 7:

 

The purpose in filing Chapter 7 bankruptcy is to give you a fresh start by discharging most of your debts and allowing you to retain certain properties that are considered exempt. The Bankruptcy Code will allow you keep certain “exempt” property, but your remaining assets, if any, will be sold and distributed to the creditors.

Accordingly, you should realize that the filing Chapter 7 bankruptcy may result in the loss of property.

In addition, as of 2005 if your “current monthly income” is more than the state median, the revised Bankruptcy Code requires application of a “means test” to determine whether you are eligible to file a Chapter 7 bankruptcy. If you do not pass the “Means Test” you will not be able to file a Chapter 7 bankruptcy and you must file a Chapter 13 bankruptcy.

Chapter 7 bankruptcy is available to all individuals, a partnerships, or a corporations or other business entities.

“We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.” 11 USC 528(a)(4).

 

Chapter 13:

A Chapter 13 bankruptcy is also called a wage earner’s plan.  If you have regular income it allows you to develop a plan to repay all or part of your debts.  I will develop a repayment plan with you to make installments to creditors over three to five years. During this time the law forbids creditors from starting or continuing collection efforts.

The advantage of filing a Chapter 13 bankruptcy is that it allows you an opportunity to save your home from foreclosure. You can stop foreclosure proceedings and may cure delinquent mortgage payments over time. Another advantage to Chapter 13 that it acts like a loan consolidation under which you make the plan payments to a Chapter 13 trustee who then distributes payments to creditors.

While you are under the Chapter 13 protection plan you will have no contact with the creditors. Chapter 13 is available to any individual, even is self-employed or operating an unincorporated business.

“We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.” 11 USC 528(a)(4).

 

Chapter 11:

A Chapter 11 bankruptcy usually involves a corporation or partnership proposing a plan of reorganization to keep its business alive and pay creditors over time.  People in business or individuals can also seek relief in chapter 11.  Chapter 11 of the United States Bankruptcy Code is frequently referred to as a “reorganization” bankruptcy.

“We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.” 11 USC 528(a)(4).

Robert A Dawid, PLLC
Attorney At Law

122 South Main Street Suite 353
Ann Arbor, MI 48104
Phone: 734-277-2567
Fax: 734-769-8284
Rob@DawidLaw.com