Detroit Bankruptcy Lawyers

Motor City Bankruptcy Malaise     

The Situation in Detroit               

The bankruptcy of General Motors is a huge economic blow to Detroit, on top of years of painful economic contraction.   Bankruptcy filings in the Motor City jumped 71% from 2006 to 2008.  The recovery expected to begin late in 2010 will not help the multitudes of unemployed or underemployed struggling to survive in Detroit right now.  It is estimated that 1.4 million consumer bankruptcies will be filed in the U.S. in 2009, the surge triggered by the foreclosure crisis and economic downturn.

Legal Advice for those Considering Filing for Bankruptcy in Detroit

The Federal Bankruptcy Law involves processes, procedures and evaluations which can be complex and confusing.  Seek the advice of a Detroit law firm with specific long-term experience in Detroit bankruptcy matters.  A competent Detroit attorney will help you weigh your options, make informed decisions, help you protect the security of your family and reduce your stress, while facing the realities of the situation.

Your Detroit Bankruptcy Will Be Impacted by Major Changes Made in 2005

Because of bankruptcy filing abuses, the law was changed in 2005 to include the following:

• Required pre-bankruptcy counseling
• Strict guidelines to qualify for a Chapter 7 filing (liquidation proceeding) including a “Means Test” to determine your ability to pay debts
• Tight restrictions on repeat filers
• Random audits to verify accuracy of bankruptcy filing
• Enhanced oversight for Chapter 11 (reorganization) small business cases

Chapter 13 Bankruptcy in Detroit

Generally, all consumers considering bankruptcy in Michigan will file either a Chapter 7 (liquidation) or Chapter 13 bankruptcy.  Chapter 13 provides for your creditors to be paid back all or a portion of the debt owed, over a period of three to five years.  Chapter 13 is often used in Detroit to prevent a foreclosure of a home or repossession of a car.  Detroit filers who do not pass the Chapter 7 “means test” will be required to file Chapter 13 or remove themselves from the bankruptcy process entirely.

Which Property is Exempt in Detroit?

Certain property, or values of property, is exempt from being included in the debtor’s estate and these exemptions vary from state to state.  Some states have their own set of exemptions which replace the federal list, and other states allow you to choose between the state or federal list of exemptions.  The exemptions, which change frequently, vary widely from jurisdiction to jurisdiction and understanding your options is a very important aspect of evaluating your position.

• If you are at risk of filing for bankruptcy or already in the process, Submit Your Case for a Free Review from a Bankruptcy Attorney in Detroit, MI.

Thoughts on Bankruptcy Filing in Detroit

As the State’s economy struggles to recover, decisions you make and actions you take now can have a positive or negative effect on the outcome of your bankruptcy proceedings.  Although some filers elect to handle their bankruptcy on their own, The U.S. Bankruptcy Court cautions that “Bankruptcy has long-term financial and legal consequences -- hiring a competent attorney is strongly recommended.”    Click here to find Detroit attorney resources in your area.