Do Not Rely on Friends and Family for Bankruptcy Advice
December 26, 2014
A Michigan Chapter 7 Law Firm Will Help You Make Choices Based on Your Unique Situation
Now that your uncle has emerged from bankruptcy debt-free, he wants to share his fresh start with everyone he cares about. If you have too many challenges keeping up with the bills — and your uncle’s advice convinces you to speak with a Chapter 7 lawyer at a Michigan law firm — he helped you take a great first step. However, if he insists that you handle your situation in exactly the way he did, you need to step back from his advice. Everyone’s situation involves distinctive details that require customized solutions.
Every Set of Financial Circumstances is Unique
You and your uncle lead different lives. The details that led each of you toward financial challenges make a vital difference to finding the right path out:
- When your uncle filed for Chapter 13 bankruptcy, his income significantly exceeded the median income in your area, so he did not qualify for a Chapter 7 filing. After losing your job in the economic downturn, your income was dramatically reduced, making Chapter 7 bankruptcy a viable option.
- He makes mortgage payments on a home he wants to keep, while you currently rent.
- He has little equity in his new car, while you completely own yours.
- Much of his debt includes unpaid taxes, which cannot be discharged in bankruptcy, even though they still need to be addressed. Your taxes are up-to-date.
These are only a few of the many considerations that may make you different from your uncle and require assessment by a qualified Chapter 7 attorney.
There are Often Multiple Paths Toward a Fresh Start
Your uncle may be proud of the fact that he worked hard to repay his outstanding debt by filing for Chapter 13 bankruptcy. The U.S. Courts explain certain benefits to Chapter 13, such as the following:
- It provides the opportunity to save a home from foreclosure.
- It has a provision that protects third parties from liability on consumer debt.
- It simplifies the loan-repayment process by acting like a consolidation loan.
These benefits may have been perfect for your uncle, but Chapter 13 might be the wrong choice for you. For one thing, if your income and expenses qualify you for Chapter 7, you may not have the available funds to repay all outstanding debt. Additionally, you may appreciate the speed and relative simplicity of a Chapter 7 filing over a five to seven-year repayment process. Or, your situation may require some other alternative entirely.
Be Sure to Make the Right Choice
With more than two decades of experience, the Law Office of Jeffrey J. Randa has helped guide countless clients to the solutions that make the most sense for them. We look at every detail and clearly explain your options so you can make an informed decision on how to proceed. It costs nothing to schedule a free initial consultation Call us at 586-228-6523, or use our convenient contact form to take the first step toward the fresh start that can help with your unique situation.