Corporate Bankruptcy - Michigan Bankruptcy Facts 734-722-2999

Advantages & Disadvantages to a Michigan Chapter 13 payment plan:

admin — Thu, 19 Nov 2015 03:37:50 +0000

Advantages to a Michigan Chapter 13 payment plan:

If you choose and you can afford the payment plan, you can keep all your property, exempt and non-exempt.
While debts are not canceled as in a Chapter 7 discharge they can be reduced under a Chapter 13 payment plan.
You have immediate protection against creditor’s collection efforts and wage garnishment.
More debts are considered to be dischargeable (including debt you incurred on the basis of fraud and credit card charges for luxury items immediately prior to filing).
If the Chapter 13 plan provides for full payment, any co-signers are immune from the creditor’s efforts.
You have protection against foreclosure on your home by your lender as long as you meet the terms of the plan.
You have more time to pay debts that can’t be discharged by either chapter (like taxes or back child support).
You can file a Chapter 13 at any time.
You can file repeatedly.
You can separate your creditors by class where different classes of creditors receive different percentages of payment. This enables you to treat debts where there is a co-debtor involved on a different basis than debts incurred on your own.

Disadvantages to a Michigan Chapter 13 payment plan:

You create a payment plan where you use your post bankruptcy income. This ties up your cash over the Chapter 13 plan period.
Legal fees are higher since a Chapter 13 filing is more complex.
Your plan and therefore your debt will last for 3 to five years.
You are involved in the bankruptcy court process for the term of the 3-5 year plan.
Stockbrokers, and commodity brokers cannot file a Chapter 13 bankruptcy petition.

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Michigan Chapter 13 Bankruptcy

admin — Wed, 26 Aug 2015 12:51:44 +0000

There are a number of options to consider under the US Bankruptcy Code when it comes to dealing with debt and filing a petition. Chapter 13 Bankruptcy is a more complex form of petitioning and the main difference between it and Chapter 7 is that the former is a “reorganization” or “restructuring” of debt, whereas the latter is straight “liquidation”.
So what are the main characteristics of the Chapter 13 Bankruptcy under Michigan Bankruptcy Laws?
• Chapter 13 Bankruptcy is available as an option only for individuals
• It is an opportunity for them to start afresh and pay-off significant portions of their outstanding debts
• The debtor commits to repaying all or part of what he owns to his creditors under a 3-5 year repayment plan which has to be approved by the Court.
• The individual must be earning a regular income and have sufficient disposable income to apply for Chapter 13 Bankruptcy
• Most commonly people use Chapter 13 when they are late with mortgage, tax or car payments or want stop their tax debt accruing interest.
Typically, debtors who apply under Chapter 13 have valuable secured assets, such as real estate or a car, which they want to protect as the equity in these assets is higher than the protected amount under Michigan bankruptcy exemptions.
How does it work?
The first step is to develop a repayment plan which is the key to a successful Chapter 13 petition as it describes in detail how much each of your creditors will get paid. The next step is to get the plan approved by the court. You then have 30 days after filing the case to make your first repayment.

It is important to know that there are a number of factors at play for determining the amount of the repayments, with the debtor’s disposable income being the main criteria. There is a Michigan Means Test which is usually used. Bear in mind that in order to qualify for a Chapter 13 Bankruptcy the total amount to be paid under the plan must be at least as much as what creditors would have received under a Chapter 7 Bankruptcy. When it comes to exemptions, in Michigan you can choose between the federal statutes or Michigan exemptions.
In general Chapter 13 is more suitable if you have valuable property not covered by the

Michigan bankruptcy exemptions and you would like to protect it. Like with other cases of bankruptcy filing, it is always best to call Firebaugh & Andrews for your free evaluation 734-722-2229 advice before proceeding to ensure that you are acting in your best interest. Firms that specialize in bankruptcy law have a wealth of experience and knowledge that is well worth tapping into when it comes to making important financial decisions.

The post Michigan Chapter 13 Bankruptcy first appeared on Michigan Bankruptcy Facts 734-722-2999.

The post Michigan Chapter 13 Bankruptcy appeared first on Michigan Bankruptcy Facts 734-722-2999.

Corporate Bankruptcies: The Effects on the Investors

admin — Mon, 01 Sep 2014 18:17:25 +0000

The investors get placed between the rock and the hard place when the company he or she has invested has declared bankrupted. But if the company has filed the bankruptcy under the Chapter 11, there’s a fair chance to get paid off.
According to Securities and Exchange Commission, while the company has file under Chapter 11 the bondholders stop receiving interest and principal payments while the stockholders, on the other hand, stop receiving dividends. “If you are a bondholder, you may receive new stock in exchange for your bonds, new bonds or a combination of stock and bonds. If you are a stockholder, the trustee may ask you to send back your stock in exchange for shares in the reorganized company.” These new shares may be fewer in number and probably will worth less than it was before. In other words the reorganization plan “…spells out your rights as an investor and what you can expect to receive, if anything, from the company.”

But if the company failed to recover, then the investor has to accept the inevitable. After being fail to recover the company can file under Chapter 7 which put a stop to company’s all operations and making it asset turn it to a way to pay the creditors. In Chapter 7 investors are regarded as the lowest rung of the ladder. So they instead of crying over spilled milk need to accept the situation because while agreeing to invest in the company they accept the risks that are involve with an investment. Bankruptcy is one of such risk.

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Corporate Bankruptcies: The Relationship between Chaper 7 & Chapter 11 Bankruptcy

admin — Mon, 01 Sep 2014 18:07:11 +0000

There is no direct relationship between Chapter 7 and Chapter 11. But when it comes to corporate bankruptcies there can set a relationship between the two bipolar Chapters.
The U.S. Security and Exchange Commission (SEC) define Chapter 7 as taking the business out of its all operations and turning it into an asset. The asset is sale off through an appointed committee and the one, investors or creditors, who take the least risks, are paid first. Chapter 11, while on the contrary, keeps the business in the running state and allowing it to pay the creditors by re-planning or rephrasing its financial acts.

There are instances that show the bankrupted company has made a successful comeback after filing under Chapter 11. It has done by re-planning their operations with the help of court appointed committee or trustee. But most of the time, and often, this conversion from being bankrupted to a profitable sector is not success. The company then has to turn to Chapter 7 for being free from the shackles of credits. And here lies the under breath relationship between the two Chapters.
When the company failed to resurface itself by Chapter 11 it can turn to Chapter 7. The flexibility of bankruptcies rule has lead to this transformation and also helped the company to pay off their debt. Thus, though, Eleven and Seven are dissimilar in many facts but ultimately they are acting as the savior in one form or another. Call Firebaugh and Andrews today for your free consultation 734-722-2229

The post Corporate Bankruptcies: The Relationship between Chaper 7 & Chapter 11 Bankruptcy first appeared on Michigan Bankruptcy Facts 734-722-2999.

The post Corporate Bankruptcies: The Relationship between Chaper 7 & Chapter 11 Bankruptcy appeared first on Michigan Bankruptcy Facts 734-722-2999.