Sterling Heights, Michigan

Chapter 13 Lawyer

One of the Best Bankruptcy Attorneys in Sterling, MI

Office Location

23843 Joy Rd
Dearborn Heights, MI 48127

Monday – Friday : 9:00 am – 5:00 pm
Saturdays : 9:30am – 11:30 in office or by phone

We offer late night appointments as late as 6:30 by phone or in person Mon-Thur.

Highly Recommended

Get a Free Consultation

Sterling Height Chapter 13 Lawyers

Filing for bankruptcy can be a daunting process, but for many, it’s a vital step toward regaining financial stability. Our Sterling Heights Chapter 13 bankruptcy attorney offers an opportunity for you to reorganize your debts while maintaining your assets.

Here’s a closer look at what Chapter 13 entails and how it can benefit you.

What is Chapter 13 Bankruptcy?

Chapter 13 bankruptcy, often referred to as a “wage earner’s plan,” allows individuals with a regular income to create a repayment plan to pay back all or part of their debts over three to five years. 5416 Chapter 13 bankruptcies were filed in 2024 in Michigan until now. [1]

Unlike Chapter 7 bankruptcy, which involves liquidating assets to pay creditors, Chapter 13 enables filers to keep their property while making manageable monthly payments.

Benefits of Chapter 13 Bankruptcy in Sterling Heights

Filing for Chapter 13 bankruptcy can be a strategic move for you as a resident of Sterling Heights. Here are some key benefits to consider:

Asset Protection: With Chapter 13, you can protect your assets, such as your home and vehicle, from foreclosure and repossession. This is especially important in a community where homeownership is valued.
Debt Consolidation: Chapter 13 allows you to consolidate multiple debts into one manageable monthly payment. This simplifies your financial management and helps reduce the stress of dealing with various creditors.
Stop Foreclosure and Repossession: If you’re facing foreclosure or repossession, filing for Chapter 13 provides immediate relief. The automatic stay halts all collection activities, giving you time to catch up on payments.
Flexible Repayment Plans: You can create a repayment plan that fits your financial situation, spanning three to five years. This flexibility helps you manage your budget while paying back debts.
Potential for Reduced Debt: You might only need to repay a portion of your unsecured debts, such as credit cards and medical bills, which can provide significant relief - allowing you to start fresh.
Rebuilding Credit: Making consistent payments under Chapter 13 can help you rebuild your credit over time, improving your chances of securing loans or mortgages in the future.
Local Support Resources: Sterling Heights offers access to legal aid and financial counseling services, providing valuable guidance and emotional support throughout the process.

Eligibility for Chapter 13 Bankruptcy in Sterling Heights

Filing for Chapter 13 bankruptcy can provide significant relief for individuals facing financial difficulties, but there are specific eligibility criteria you must meet. Here’s what you need to know:

Regular Income: To qualify for Chapter 13, you must have a regular source of income. This could be from employment, self-employment, or other consistent income streams, such as Social Security benefits or pensions. The income needs to be stable enough to support a repayment plan.
Debt Limits: There are limits on the amount of debt you can have to qualify for Chapter 13:

Unsecured Debt: You cannot have more than $465,275 in unsecured debt (like credit card debt or medical bills).
Secured Debt: Your secured debt (like mortgages or car loans) must not exceed $1,395,875. [2]

These limits are subject to change, so it’s essential to check the current figures before proceeding.

A list of your creditors
A schedule of assets and liabilities
A statement of your financial affairs
Your current income and expenses

Completing these forms accurately is crucial for your case to be processed smoothly.

No Previous Bankruptcy Discharges: To qualify for Chapter 13, you must not have received a bankruptcy discharge in the past two years under Chapter 13 or four years under Chapter 7. If you have previously filed for bankruptcy, the timing of your prior discharge will affect your eligibility.
Good Faith Filing: You need to file your Chapter 13 petition in good faith. This means you should not be attempting to manipulate the system or abuse the bankruptcy process. Courts will assess whether your repayment plan is feasible and reasonable based on your financial situation.

Exemptions for Chapter 13 Bankruptcy in Sterling Heights, Michigan

When you file for Chapter 13 bankruptcy, certain assets may be exempt from being included in your repayment plan. This means you can keep these assets while reorganizing your debts. Here are the key exemptions available:

Homestead Exemption: One of the key exemptions available is the homestead exemption. In Michigan, you can exempt property as long as the total equity is less than $40,475. This amount increases to $60,725 if you are disabled or over 65 years old. Additionally, a surviving spouse who owns a home can also benefit from this exemption.
Wages: If you earn a living, you can claim an exemption on your wages. Under applicable bankruptcy laws, you may exempt up to 60% of your unpaid wages. You can also claim $15 per week for yourself, while dependents can claim $2 per week. For others, the exemption is $10 per week or 40% of your income.
Motor Vehicles: Michigan residents can take advantage of a motor vehicle exemption, allowing you to exempt at least $3,725 in equity in a vehicle you own. This exemption is necessary for those looking to retain their valuable vehicles while seeking debt relief under Chapter 7.
Pension and Retirement Accounts: Most retirement and pension accounts are protected under Michigan law. Personal annuities and retirement plans enjoy bankruptcy protection, allowing you to safeguard profit-sharing plans and stock bonuses as long as contributions were made within 120 days prior to filing your bankruptcy petition. Additionally, retirement accounts like 401(k)s and IRAs are protected up to certain limits.
Personal Property Exemptions: Michigan allows exemptions for personal property, including:

Household Goods
Retirement Accounts

Hiring Our Sterling Height Chapter 13 Attorney

Chapter 13 provides protection from creditors and collection efforts, giving you peace of mind. Here is how Frego law can help:

Expert Navigation: Working with our experienced local bankruptcy lawyers ensures you have the expertise needed to navigate the complex bankruptcy process.
Timely Filing: We ensure all necessary paperwork is accurately completed & filed on time, increasing the likelihood of a successful case.
Creditor Negotiation: Our bankruptcy lawyers can negotiate with creditors on your behalf and represent you in court if necessary.
FREE Consultation: Contact us today to schedule a complimentary consultation and explore your options.

With our support, you can take the first step toward financial stability. Reach out to our experienced Sterling Heights bankruptcy attorney now to learn more about how we can assist you!

FAQs

How long does the Chapter 13 bankruptcy process take in Sterling Heights?

The Chapter 13 process typically lasts three to five years, depending on your repayment plan. Once you file, you’ll need to attend a meeting of creditors (341 meeting) and follow the court’s timeline for submitting documents and payments.

Will I lose my tax refunds if I file for Chapter 13 in Sterling Heights?

Tax refunds are not automatically exempt in Chapter 13. Depending on your situation, you may need to use some or all of your tax refund to fund your repayment plan. It’s important to discuss your specific circumstances with your attorney.

Can I still use credit while in Chapter 13 bankruptcy?

While you can apply for new credit during your Chapter 13 repayment plan, obtaining approval can be difficult, and creditors may be hesitant to extend credit. Additionally, you’ll need permission from the court for any significant new debt.

What happens if I miss a payment during my repayment plan in Sterling Heights?

Missing a payment can have serious consequences, including potentially dismissing your bankruptcy case. If you anticipate difficulties making a payment, communicate with your bankruptcy attorney and consider options for modifying your plan.

Can I include my student loans in Chapter 13 in Sterling Heights?

While student loans are generally not dischargeable in bankruptcy, you can include them in your Chapter 13 repayment plan. This allows you to repay them over the duration of the plan, potentially making payments more manageable.

How will filing for Chapter 13 affect my credit score?

Filing for Chapter 13 will initially lower your credit score in Sterling Heights, but making timely payments under your repayment plan can help you rebuild your credit over time. The bankruptcy will remain on your credit report for seven years.

Sources:

[1] Court Statistics | Eastern District of Michigan | United States Bankruptcy Court. (n.d.). https://www.mieb.uscourts.gov/court-statistics

[2] O’Neill, C. (2024, July 8). Debt Limits for Chapter 13 Bankruptcy. https://www.alllaw.com/articles/nolo/bankruptcy/debt-limits-chapter-13-bankruptcy.html

Office Location

23843 Joy Rd
Dearborn Heights, MI 48127

Monday – Friday : 9:00 am – 5:00 pm
Saturdays : 9:30am – 11:30 in office or by phone

We offer late night appointments as late as 6:30 by phone or in person Mon-Thur.

Highly Recommended

Get a Free Consultation

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