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(The following is for educational purposes only, and it should not be construed as legal advice. PayingPaul.Com makes no guarantees about the accuracy of any information included here. For legal advice, please consult an attorney or lawyer in your state).
Michigan & The New Bankruptcy Law: Bad Timing
With unemployment climbing in Michigan the new bankruptcy law could not have been legislated at a more trying time for the state. With more than 4.7 million unemployed in 2005 and a wave of foreclosures set to hit the state, the number of consumers experiencing money problems was substantial. At the same time, the door for people with serious financial problems was being closed, at least partly. Under the new bankruptcy requirements, people who earn more than the median income in Michigan are obligated to prove that they cannot afford to pay off at least part of the debt through a Chapter 13 reorganization plan by passing the “means test”. The following are some information about Michigan’s median income statistics as of 2006:
2-person families 50,441
3-person families 60,085
4-person families 72,591
5-person families 70,028
6-person families 60,035
7-or-more-person families 53,080
What’s So Bad About Filing Chapter 13
There are several reasons why this is bad for consumers:
1) Under a Chapter 13 plan, the debtor is required to pay down some or all of the debt from their monthly disposable income for up to five years, which is considerable.
2) The monthly payment can be deducted from the debtors’ paycheck, which means their employer can find out. Although no one can be discriminated against for having filed bankruptcy, it is still something that most people find unpleasant.
3) The credit impact is still severe, lasting for up to seven years.
A Chapter 7 bankruptcy, on the other, oftentimes can wipe out your debt entirely without much in terms of cost other than court and attorney fees. Although the credit effects of Chapter 7 can be harsh, people tend to prefer this avenue for credit card debt help over Chapter 13 because it involves immediate resolution.
In light of all of this, more Michigan consumers are using credit solutions like debt settlement and credit counseling. To get matched with a pre-qualified debt service fill out a form and PayingPaul.Com will direct you to company who can help!
You can also read up on some of the different credit & debt laws in Michigan:
Michigan Consumer Credit Counseling Services
Michigan Bankruptcy Laws
Michigan Debt Collection
Bankruptcy Filing Info for Michigan
2004: 63,531
2005: 88,402
2006: 32,746
Michigan has been plagued with severe economic problems in the past two decades, but despite this fact, consumer bankruptcy filings dropped precipitously in response to the Bankruptcy Abuse Prevention and Consumer Protection Act in 2005. In all, the number of people filing bankruptcy in Michigan decreased by 63 percent. Relative to the rest of the country, however, this was still a less striking of a downfall, which is a tribute to the condition of the economy in the state. Still, since the passing of more stringent bankruptcy laws more consumers are turning to credit debt management programs for help.
Michigan & The New Bankruptcy Law: Bad Timing
With unemployment climbing in Michigan the new bankruptcy law could not have been legislated at a more trying time for the state. With more than 4.7 million unemployed in 2005 and a wave of foreclosures set to hit the state, the number of consumers experiencing money problems was substantial. At the same time, the door for people with serious financial problems was being closed, at least partly. Under the new bankruptcy requirements, people who earn more than the median income in Michigan are obligated to prove that they cannot afford to pay off at least part of the debt through a Chapter 13 reorganization plan by passing the “means test”. The following are some information about Michigan’s median income statistics as of 2006:
2-person families 50,441
3-person families 60,085
4-person families 72,591
5-person families 70,028
6-person families 60,035
7-or-more-person families 53,080
What’s So Bad About Filing Chapter 13
There are several reasons why this is bad for consumers:
1) Under a Chapter 13 plan, the debtor is required to pay down some or all of the debt from their monthly disposable income for up to five years, which is considerable.
2) The monthly payment can be deducted from the debtors’ paycheck, which means their employer can find out. Although no one can be discriminated against for having filed bankruptcy, it is still something that most people find unpleasant.
3) The credit impact is still severe, lasting for up to seven years.
A Chapter 7 bankruptcy, on the other, oftentimes can wipe out your debt entirely without much in terms of cost other than court and attorney fees. Although the credit effects of Chapter 7 can be harsh, people tend to prefer this avenue for credit card debt help over Chapter 13 because it involves immediate resolution.
In light of all of this, more Michigan consumers are using credit solutions like debt settlement and credit counseling. To get matched with a pre-qualified debt service fill out a form and PayingPaul.Com will direct you to company who can help!
You can also read up on some of the different credit & debt laws in Michigan:
Michigan Consumer Credit Counseling Services
Michigan Bankruptcy Laws
Michigan Debt Collection
Bankruptcy Filing Info for Michigan
2004: 63,531
2005: 88,402
2006: 32,746
Michigan has been plagued with severe economic problems in the past two decades, but despite this fact, consumer bankruptcy filings dropped precipitously in response to the Bankruptcy Abuse Prevention and Consumer Protection Act in 2005. In all, the number of people filing bankruptcy in Michigan decreased by 63 percent. Relative to the rest of the country, however, this was still a less striking of a downfall, which is a tribute to the condition of the economy in the state. Still, since the passing of more stringent bankruptcy laws more consumers are turning to credit debt management programs for help.