You may have experienced a financial hardship and now are deciding whether to file bankruptcy in Michigan. We are sorry to hear that you are needing to read this article right now, but our goal is to explain how everything works, so you can decide whether bankruptcy is right for you. Here’s what we’ll cover:
- Filing Bankruptcy in Michigan
- Chapter 7 vs Chapter 13 in Michigan
- Chapter 7 Bankruptcy Michigan
- Chapter 13 Bankruptcy Michigan
- Cost of Chapter 7 and Chapter 13 in Michigan
- Michigan Bankruptcy Assistance
- Michigan District, Court, And Trustee Information
- Alternatives to Bankruptcy in Michigan
Filing Bankruptcy in Michigan
You’ll notice from the table of the contents that we focus specifically on Chapter 7 and Chapter 13 bankruptcy. Why? Because these two types of bankruptcy are the most common bankruptcy in America (source). There are other types such as the Chapter 11 and Chapter 11 subchapter 5 bankruptcies, but these are far less common for consumers (source).
Chapter 7 bankruptcy is also known as the liquidation bankruptcy. Chapter 13 bankruptcy is also known as wage earner’s plan. We will cover these in greater detail
Michigan Bankruptcy Filing Process
The bankruptcy filing process in Michigan is similar to other states. Generally, the process is as follows for Chapter 7 bankruptcy:
- Understand bankruptcy qualification
- Decide whether to file Chapter 7 or Chapter 13
- Decide whether to hire an attorney
- Take the Credit Counseling Course
- File Bankruptcy Petition and Other Forms
- Michigan trustee is assigned to the case
- Attend 341 Meeting of Creditors (Michigan court locations below)
- Take Second Mandatory Debt Education Course
- Receive Bankruptcy Discharge
Chapter 7 vs Chapter 13 in Michigan
Chapter 7 bankruptcy: In Chapter 7, you are at risk of your nonexempt property being sold and used to pay off debts. It’s generally meant for those who cannot afford to pay little to any of your debt. It’s often less expensive than a Chapter 13 bankruptcy, and you can receive a discharge within 120 days. It stays on your credit report for 10 years.
Chapter 13: In Chapter 13, you reorganize your debts similar to a debt settlement program. Your property above the exemption is often not sold as you may be able to protect your assets. It’s often more expensive than a Chapter 7 bankruptcy, and you generally will receive a discharge in 3 or 5 years. It stays on your credit report for 7 years.
When your debt is discharged, this means that you are not required to pay that debt back.
Chapter 7 bankruptcy Michigan
As Chapter 7 is the most common consumer bankruptcy filing, we will cover this bankruptcy first. In order to file Chapter 7 bankruptcy, you have to go through means-testing. The means test was added to the Bankruptcy Code in 2005 to prevent bankruptcy fraud. The income requirement for Michigan helps ensure that a person with a sufficient income to pay back some of the debts may file a Chapter 13 instead of Chapter 7.
Michigan bankruptcy means test
The first part of the means test is to calculate your current monthly income. A Michigan bankruptcy means test calculator can help you estimate whether you qualify for a Chapter 7 below or above the median, which is to say that you may qualify for a Chapter 7 even if your income exceeds the median in Michigan, which is why a means test calculator may help.
If you want to do a ballpark estimate, you can estimate your current monthly income by taking the last 6 months of your income and dividing by 6. You will then be able to compare that figure to the Michigan means testing data for cases filed on or after May 1, 2020. You would add $9,000 to the annual income for any individuals in the household greater than 9 people.
Means testing for Michigan
| # of People | Annual Income |
|---|---|
| 1 | $53,113 |
| 2 | $64,428 |
| 3 | $78,217 |
| 4 | $93,653 |
| 5 | $102,653 |
| 6 | $111,653 |
| 7 | $120,653 |
| 8 | $129,653 |
| 9 | $138,653 |
Michigan bankruptcy exemptions
We will cover Michigan bankruptcy exemptions next because you may qualify for a Chapter 7 bankruptcy, but wonder whether they are going to come over and try to sell all your assets.
Firstly, in Chapter 7, you may be worried about losing your vehicle (non-luxury). Often a vehicle can be reinstated with a car payment in Chapter 7 bankruptcy in Michigan. Here’s a link to the Michigan bankruptcy exemptions.
It’s important to note that Michigan does also utilize the federal exemptions.
Please also note that you may want to check the Michigan government website for a complete list of Michigan bankruptcy exemptions and up to date information.
Chapter 13 bankruptcy Michigan
Chapter 13 bankruptcy Michigan is a payment plan bankruptcy where your debts are reorganized via the bankruptcy court, often in a 3 or 5-year payment plan. One of the most important questions is determining your monthly plan payment. Once you have a sense of your plan payment, you compare that payment to your current monthly obligations to see whether you may afford Chapter 13 bankruptcy. Debt settlement is often an alternative to a Chapter 13 bankruptcy. For a deep dive on Chapter 13 bankruptcy, you may want to check out the article titled Chapter 13 Michigan
Chapter 13 Payment
One of the most important things for a Chapter 13 bankruptcy is determining whether you can afford the Chapter 13 plan payment and comparing it to your current monthly obligations. There are various bankruptcy forms that can be used to estimate your Chapter 13 plan payment, but we found the easiest way is to use the Michigan Chapter 13 Calculator which uses bankruptcy forms to help estimate plan payment.
Michigan Bankruptcy Assistance
You may be wondering what sort of bankruptcy assistance is available in Michigan. Let’s go through some of the options.
Michigan Legal Assistance:
You may be considering filing bankruptcy in Michigan and wondering what sort of legal assistance is available. You may want to check out any of the following options:
Cost of Chapter 7 and Chapter 13 in Michigan
Any important question that you are probably asking yourself is what is the cost of attorney fees, filing fees and whatever other costs are associated with bankruptcy.
- Attorney Fee: Often different cities and counties in Michigan will have different attorney costs, including variability of cost based on experience. You may want to check out a Michigan bankruptcy cost calculator to estimate the cost for your zip code.
- Filing, Admin and/or trustee surcharge fee: The fee for Chapter 7 is $335 and the fee for Chapter 13 is $310 (source).
Michigan Districts and Courts
Eastern District
- Theodore Levin U.S. Courthouse231 W. Lafayette Blvd.
Detroit, MI 48226
- Federal Building200 E. Liberty Street
Ann Arbor, MI 48104
- United States Post Office Building1000 Washington Ave.
Bay City, MI 48708
- Federal Building and U.S Courthouse600 Church Street
Flint, MI 48502
- Federal Building and United States Courthouse526 Water Street
Port Huron, MI 48060
Western
- 399 Federal Bldg
110 Michigan St NW
Grand Rapids MI 49503 - 113 Federal Bldg
315 W Allegan St
Lansing MI 48933 - 107 Federal Bldg
410 W Michigan Ave
Kalamazoo MI 49007 - 330 Federal Bldg
202 W Washington St
PO Box 698
Marquette MI 49855
Michigan Bankruptcy Trustees
Here are the Chapter 7 Bankruptcy Trustees in Michigan and the Chapter 13 Bankruptcy trustees in Michigan.
Chapter 7 Trustee(s) in Michigan
| District | Name | Phone |
|---|---|---|
| Eastern | Collene K. Corcoran | (248) 969-9300 |
| Eastern | Frederick J. Dery | (248) 362-4655 |
| Eastern | Douglas S. Ellmann | (734) 668-4800 |
| Eastern | Karen E. Evangelista | (248) 652-7992 |
| Eastern | Randall L. Frank | (989) 893-2461 |
| Eastern | Stuart A. Gold | (248) 350-8220 |
| Eastern | Daniel C. Himmelspach | (989) 790-0400 |
| Eastern | Gene R. Kohut | (313) 886-9765 |
| Eastern | Wendy T. Lewis | (313) 832-5555 |
| Eastern | Kyung-Jin Lim | (734) 416-9420 |
| Eastern | Homer W. McClarty | (248) 352-7686 |
| Eastern | Timothy J. Miller | (586) 281-3764 |
| Eastern | Kenneth Andrew Nathan | (248) 663-5133 |
| Eastern | Mark H. Shapiro | (248) 352-4700 |
| Eastern | Basil T. Simon | (313) 962-6400 |
| Eastern | Michael A. Stevenson | (248) 354-7906 |
| Eastern | Samuel D. Sweet | (248) 236-0985 |
| Western | Thomas Allen Bruinsma | (616) 975-2010 |
| Western | Scott A. Chernich | (517) 371-8100 |
| Western | Darrell R. Dettmann | (906) 228-7355 |
| Western | Laura J. Genovich | (616) 726-2280 |
| Western | Lisa E. Gocha | (616) 797-4206 |
| Western | Kelly M. Hagan | (231) 938-7095 |
| Western | Stephen L. Langeland | (269) 382-3703 |
| Western | Marcia R. Meoli | (616) 396-2124 |
| Western | Jeffrey A. Moyer | (616) 532-4002 |
| Western | John A. Porter | (616) 874-4800 |
| Western | Thomas C. Richardson | (269) 349-7415 |
| Western | Thomas R. Tibble | (269) 342-9482 |
Chapter 13 Trustee(s) in Michigan
| District | Name | Phone |
|---|---|---|
| Eastern | Carl L. Bekofske | (810) 238-4675 |
| Eastern | Krispen S. Carroll | (313) 962-5035 |
| Eastern | Thomas W. McDonald, Jr. | (989) 792-6766 |
| Eastern | David W. Ruskin | (248) 352-7755 |
| Eastern | Tammy L. Terry | (313) 967-9857 |
| Western | Barbara P. Foley | (269) 343-0305 |
| Western | Brett N. Rodgers | (616) 454-9638 |
Alternatives to Bankruptcy in Michigan
You may be reading through this and wondering what are the alternatives to Chapter 7 or Chapter 13 bankruptcy. The most common alternatives are debt management, debt settlement, and debt payoff planning. Each of these options have pros and cons, so doing your due diligence is important. You can also feel free to reach out to us if you have any questions whatsoever.