Effective April 1, 2010, the federal exemptions that you can use in your Michigan bankruptcy have changed. Exemptions are dollar allowances for real and personal property that you can keep when you file for bankruptcy in Michigan. The exemptions provide the basis for your fresh start. Here are the new exemption amounts: Homestead: 522(d)(1) Real…
Michigan Bankruptcy: Who Should File Chapter 7 Bankruptcy in Michigan?
This is a short entry on who should file chapter 7 bankruptcy in Michigan and why. Chapter 7 bankruptcy is unique in couple very significant ways and I’ll highlight those differences. When we here folks use the term “Fresh Start” they are talking about filing a chapter 7 bankruptcy 9 times out of 10. The…
Strategic Default in Michigan? I Don’t Think So..Mi Foreclosure Info.
Is strategic default a good strategy for Michigan foreclosures? I recently saw a piece on 60 Minutes talking about a process called “Strategic Default.” With a strategic default, a homeowner intentionally stops paying their mortgage and lets the bank foreclose on the house. This is an option that many homeowners are considering when they are…
Personal Michigan Bankruptcy Stories: Bankruptcy Client
This is a story I received from a client who retained my services for a Michigan chapter 7 bankruptcy. I don’t usually post personal stories of people who filed bankruptcy, but he not only gave me permission, he encouraged it. Again this perspective on filing a chapter 7 is his, and not my own, and…
Bankruptcy and The Bible
Bankruptcy and the Bible We live in a time like no other. Here in Michigan, many of us are struggling to just to keep up with our day to day living expenses. As a result of divorce, job loss or illness, many of us have incurred debts that we can never repay. Many Christians feel…
Is the debt canceled in a short sale treated as taxable income?
The Mortgage Forgiveness Debt Relief Act of 2007 excludes canceled debts on your personal residence from being classified as income.This special, limited exception was extended through 2012. Let’s say you negotiate a short sale on your house like this: You owe $100,000 on the loan, but the house is only worth $50,000. You find a…
What’s the difference between the cancellation of a debt or the discharge of that same debt in a Michigan bankruptcy?
The difference has huge tax implications. Discharged debt is not taxed as income to you – BUT canceled debt is treated as income and taxed. Let’s say that you owe $100,000 on an unsecured loan. You default after paying off $50,000 and you still owe $50,000. If your banks writes off the $50,000 balance and…