Clients may want to delay a bankruptcy until
after they have paid creditors whose claims they do not want to see
discharged, for example friends or grantors of credit cards they want to
keep. Such payments, if over $600 and within the applicable preference
period could be set aside by the bankruptcy trustee.
Thus, if a client wants to pursue this course of action, and ensure
that the creditor retains the payment, the petition must be delayed
until after the preference period has run.
In most cases, it is preferable not to delay a bankruptcy for
this purpose, but rather to pay the creditor after the petition is
filed, using either exempt assets or post-petition income. There is no
impediment to this course of action in a chapter 7 case and usually it
will not be questioned in a chapter 13 case.
Bankruptcy Lawyer Located in Grand Rapids Michigan. Law firm does Chapter 7 and Chapter 13 Bankruptcies.
Wednesday, July 25, 2012
Saturday, February 18, 2012
Will I lose everything if I file for bankruptcy in Michigan?
No, you will not "lose everything" in bankruptcy. In fact, for some of you, you might not lose anything at all.
The bankruptcy code gives petitioners, those filing for bankruptcy, certain property exemptions so they are not left with nothing post bankruptcy. In the state of Michigan, you may choose between Michigan's exemption or Federal exemptions. These two exemptions, although somewhat similar, can lead to varying results. For example, Under Michigan's exemption set you can get a homestead exemption of $35,300, while only a $21,625 exemption under the federal option. However, the Michigan exemption option only allows for $3,525 for household items, while under the federal option you can exempt up to $11,525.
Other exemptions:
Motor Vehicles:
Federal - $3,450
Michigan - $3,250
Jewelry:
Federal - $1,450
Michigan - None
Computer:
Federal - None
Michigan - $600
Life Insurance:
Federal - $11,525
Michigan - None
Crops, farm animal, feed:
Federal - None
Michigan - $2,350
A huge benefit to using the Federal option is the "wild card" exemption. The wild card exemption can be worth up to $11,975 depending on how much of their homestead exemption the petitioner used.
Any Michigan bankruptcy lawyer should understand the difference between the two options and be able to advise you on how you should proceed in order to maximize the protection given to your estate.
If you have any question and would like to give us a call, contact us at our Grand Rapids, Michigan law office at (616) 717-5734.
The bankruptcy code gives petitioners, those filing for bankruptcy, certain property exemptions so they are not left with nothing post bankruptcy. In the state of Michigan, you may choose between Michigan's exemption or Federal exemptions. These two exemptions, although somewhat similar, can lead to varying results. For example, Under Michigan's exemption set you can get a homestead exemption of $35,300, while only a $21,625 exemption under the federal option. However, the Michigan exemption option only allows for $3,525 for household items, while under the federal option you can exempt up to $11,525.
Other exemptions:
Motor Vehicles:
Federal - $3,450
Michigan - $3,250
Jewelry:
Federal - $1,450
Michigan - None
Computer:
Federal - None
Michigan - $600
Life Insurance:
Federal - $11,525
Michigan - None
Crops, farm animal, feed:
Federal - None
Michigan - $2,350
A huge benefit to using the Federal option is the "wild card" exemption. The wild card exemption can be worth up to $11,975 depending on how much of their homestead exemption the petitioner used.
Any Michigan bankruptcy lawyer should understand the difference between the two options and be able to advise you on how you should proceed in order to maximize the protection given to your estate.
If you have any question and would like to give us a call, contact us at our Grand Rapids, Michigan law office at (616) 717-5734.
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