Bankruptcy

Will I lose my house and car if I file for bankruptcy?
Not usually. Filing bankruptcy in Michigan offers two sets of exemptions (lists and values of items you can keep), plus a third option called Entireties property. These three choices are as follows:

1. Federal exemptions listed in the bankruptcy statue declare that any person in a Chapter 7 bankruptcy can keep the equity in their residence up to a value of $21,625. Thus, $43,250 if husband and wife file together. This means that you can keep your home as long as you continue paying the mortgage and tax payments if the net value of your home after subtracting the mortgage balance doesn't exceed $43,250.

Further, you can keep a vehicle with a net value not to exceed $3400 each person; household furnishings and clothing $10,775 each person; jewelry up to $1440 each person; pension 401K, IRA, etc. up to $1,050,000 each person, and more specific items like paid-up life insurance, accident awards, etc.

2. Michigan Exemptions—Michigan exemptions, which can be substituted for the Federal exemptions, are very similar to the Federal but some of the dollar amounts are different. For instance, a filer and/or filing spouse can exempt the equity in their residence is $34,500; if either is over the age of sixty-five, the amount is $51,650.

3. Michigan Entireties Property Michigan has a statue which prohibits any court from ordering a seizure of any property (real estate and personal property) which is owned jointly by a husband and wife, if the debt is only the debt of one of the spouses. Thus, if all or most of your debt is only in your name, then the bankruptcy petition would be in your name only but will list your property as owned jointly by you and your spouse. Thus, no matter what the value of your house equity, it cannot be seized by the bankruptcy court if the house is owned jointly by you and your non-filing spouse.

Can I file for bankruptcy if I filed in the past?
A person can file for bankruptcy eight (8) years after a previous bankruptcy.

Will I lose my job because I file?
No. The Federal statute prohibits this.

If I own my own business or am self-employed, will I have to stop my business?
No.

What debts are not stopped by a bankruptcy filing?
Student loans; past-due income taxes (with some exceptions); alimony; child support; debts ordered paid in a divorce judgment (that would become your ex-spouse's responsibility if you didn't pay them); credit card debt incurred within 90 days before your bankruptcy filing.

There are other specific debts related to fraud and other specific circumstances that Attorney Robert Nickerson will be happy to review with you. For an appointment, Call (810) 987-3009 or contact us by filling out our Contact Form.