Q: In a bankruptcy, will I lose my personal property?

A: Not necessarily.

For too many people the stigma attached to declaring bankruptcy leads them to wait too long before they contact a bankruptcy attorney - and they lose their home or their car. Depending upon the particulars of your situation, a bankruptcy may actually save your property.

By consulting with an experienced Michigan bankruptcy lawyer, you will gain a clear picture of the extent of your financial obligations and the options that are available to help you move toward the future without overwhelming debt.

You will keep secured debts you can afford, drop secured debt you can't afford, and free yourself from some or all unsecured debt. You will begin to regain control of your life.

Your Home and bankruptcy

Exempt property may include your home but it will be important to talk to a bankruptcy attorney to get a clear picture of your situation and develop a strategy so you don't find your home in jeopardy again. Have you gotten behind on a few payments or can you no longer afford your home because of a loss of income or an adjustable rate mortgage that has gone through the roof? Your answer to this question will help determine which form of bankruptcy is most appropriate for you - Chapter 13 or Chapter 7.

If you've gotten behind on your house payments but not yet received a foreclosure notice, seek legal counsel NOW from a knowledgeable Michigan bankruptcy attorney. Petitioning for bankruptcy automatically stops the bank from foreclosing on your home, minimizes damage to your credit record, and gives you time to understand the options available to you, which may include:

• Keeping your home and participating in a repayment plan with reduced fees and interest in order to get current on your loan. Through the Chapter 13 program we can remove budget obstacles that may be impeding your ability to maintain and pay your mortgage such as second mortgage payments and home equity loans, high vehicle loan payments, credit card bills, medical bills, etc. Through the Chapter 13 plan we can consolidate, restructure, prioritize and potentially eliminate these types of debts to allow you to focus on maintaining your monthly mortgage payments.
• Selling your home so that you can pay the bank and keep any excess equity for yourself
• Allowing the bank to take back the home (surrender through the bankruptcy) to free yourself of a financial obligation that you can no longer maintain under your current circumstances. This process avoids the mark of a foreclosure on your credit record.

Before you accept any offers to buy your home or to refinance on a home equity line of credit or with a lower interest ARM, talk to a bankruptcy attorney who can help you understand the course of action that will work best for your particular situation.

Your Car and bankruptcy

Exempt property may include your car, but this is an area in which the new bankruptcy law has added complexity. Your ability to keep your car, and the amount of repayment (if any) will depend upon a number of factors, including when you purchased the car, the value of the car, and your ability to repay. We can modify the terms of your vehicle loan under a Chapter 13 reorganization if need be to lower your payment or extend the terms of your contract. It will be important to talk with a bankruptcy lawyer who is knowledgeable about the most current issues in bankruptcy and personal property for advice on your particular situation. Call us at 866-438-5217.

Under a Chapter 7, you have several options with your vehicle. You can voluntarily surrender your vehicle without any further financial obligation or you can re-negotiate the terms of your loan.

There are two ways to re-negotiate the loan:

• 722 Redemption: With this process, you are essentially re-purchasing the vehicle at current fair market value through a third-party financing company.
• Re-affirmation agreement: This agreement is drafted by your creditor during the process of the Chapter 7. The agreement means that you are required to make regular payments on the vehicle and that the debt is non-dischargeable. Often times the proposed terms are more favorable than your current agreement, such as a reduced interest rate. The proposal is a means to re-negotiate your car note.

To get more information regarding how our Michigan Bankruptcy experts can protect your property, call today for a free consultation.