Understanding Important Bankruptcy Terms

Trying to explore your bankruptcy options can feel like learning a new language, so before you make any choices, make sure you talk to a lawyer who can help you understand the terms that define debt reorganization and liquidation.

At the Royal Oak and Flint offices of Bidwell Tovarez PLLC, our bankruptcy attorneys will make sure you understand all important bankruptcy terms and how the provisions will affect you, so you can make a well-informed decision regarding your financial future.

Here Are The Most Common Terms To Know

Our attorneys will dispel any bankruptcy myths and make sure you have accurate information regarding every aspect of the bankruptcy process, including:

  • Reaffirmation: An agreement to pay off your debt according to the original terms of agreement, waiving your right to discharge. This is mostly used for car loans when you want to keep the car.
  • Cram down: In some Chapter 13 cases, you can force a creditor that has a lien on your property, for instance a car creditor, to accept installment payments based on the value of the property as payment in full.
  • Redemption: You may be able to redeem and keep an automobile or other personal property by paying the value of the property to the creditor in a lump sum. Any remaining balance owed would then be discharged. In some instances, we can help you obtain financing to complete the redemption.
  • Domestic support obligations: These include child support and alimony payments as well as other obligations you have agreed to in a divorce case. These obligations are not dischargeable.
  • Exemptions: In most bankruptcy cases, either Chapter 7 or 13, you will be able to keep all of your property. We can use federal and state exemptions to protect your assets. Certain luxury items you are still paying for, such as timeshares, may have to be surrendered.
  • Chapter 13 plans: When you file for Chapter 13 bankruptcy, we will create a three- to five-year payment plan you can afford. Once the plan is approved by the court, the trustee will pay your creditors a percentage of the amount you owe and the rest will be discharged at the conclusion of the payment period.
  • Credit counseling and debtor education: Bankruptcy law requires that you take a credit counseling course before you file your case and a financial management course before you receive a discharge.
  • Liquidation: When you file a Chapter 7 bankruptcy case, you can discharge all of your debt. If you have assets that we cannot exempt and protect, those assets may be liquidated by the trustee.

Get Real Answers When You Need Them Most

When you decide to consider bankruptcy, you will hear many new terms kicked around. It is easy to make guesses about what they might mean, but it is better to get real answers from an experienced lawyer. Located in Royal Oak and Flint, our attorneys help individuals across Michigan get honest answers about the bankruptcy process. Call 248-237-3718 or contact us online for a free initial consultation.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.