Monthly Archives: January 2010

Where is the Bankruptcy Court in Detroit?

Posted on January 26, 2010 | Leave a comment

In the Detroit, Michigan area, 341 Meetings and other Chapter 7 or Chapter 13 bankruptcy-related hearings are held in the Federal Bankruptcy Court at 211 West Fort St., Detroit, MI 48226. This court location houses all proceedings for debtors residing in Lenawee, Macomb, Oakland, St. Clair, Sanilac, and Wayne counties. Debtors residing in Jackson, Washtenaw, and Monroe counties may have proceedings—especially 341 Meetings—scheduled in downtown Ann Arbor instead.

Inside the Building:

In Detroit, 341 Meetings are held on the 3rd floor of the 211 W. Fort St.  building. Passing through security is not required to access this area of the building. The main elevator bank of the building is accessed just before the security gateway through the building’s lobby. Once exiting the elevators on the third floor, simply look to your right or left to see the doubled-door entry to the always extremely crowded waiting area for 341 Meetings. Through that waiting area are the individual hearing rooms for each trustee. Your hearing will be held in one or another of these rooms, depending on who your trustee is.

Bankruptcy courtrooms are located on upper floors of the same building.

Parking:

The easiest place to park is the parking structure directly across Washington from the Bankruptcy Court. However, this ramp can run you as much as $15 per visit, last time I spent any appreciable time parked inside of it. If you are able to walk a few blocks, a better bet is the surface lots 2-3 blocks to the east up Fort St. These lots charge $6-$10 per visit, flat rate. Of course, everyone in Detroit knows of a free parking-spot somewhere in the downtown area, so you may have better luck elsewhere.

Driving Directions:

Depending on your point of origin, the best way to reach the Bankruptcy Court in Detroit is take the Lodge (M-10) south and take Exit 1B onto Congress. After that, it’s a quick left turn onto Washington and 1 block up to Fort. Otherwise, turning right onto Fort from Woodward Ave. will have you arriving in front of the Bankruptcy Court within a few, quick blocks.

If you are a resident of Michigan and have questions about whether bankruptcy is an appropriate choice for you, please contact me at jhilla@aronofflinnell.com or (248) 977-4182 to schedule a free, initial consultation.

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Posted in 341 Hearing, Bankruptcy Basics, Bankruptcy court location, Michigan

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Can I Keep My Jewelry if I File for Bankruptcy?

Posted on January 16, 2010 | Leave a comment

There is a quick and a not-so-quick answer to this question, depending upon whether you are filing Chapter 7 or Chapter 13 bankruptcy.  The quick answer pertains to Chapter 13 bankrupties: if you are filing a Chapter 13 bankruptcy, the answer is YES, you will be able to keep you jewelry, no matter how valuable it is or much of it you have. The reason for this is that Chapter 13 bankruptcies are funded not through the liquidation of assets as Chapter 7 bankruptcies are but through the filing debtor’s income. Chapter 13 bankruptcies are payment-plans, essentially, and, throughout the 3-5 year life of the plan, the petitioning debtor makes a monthly payment according to the terms of the plan. It is that monthly payment that distributes “asset” to the debtors’ creditors, and the debtor’s property has nothing to do with it.

The not-so-quick answer pertains to Chapter 7 bankruptcies. A Chapter 7 bankruptcy is a complete liquidation of debt, not a reorganization as is a Chapter 13. Since all of a debtor’s debts are essentially erased through the Chapter 7 process, the creditors whose debts will be discharged by the bankruptcy are entitled to the proceeds of any of the debtor’s personal property that the court-appointed Trustee overseeing the Chapter 7 for the Bankruptcy Court is entitled to liquidate. That is to say, the extent to which creditors may have their debts satisfied is funded directly by the debtor’s personal property in a Chapter 7 and not by a monthly payment made from the debtor’s earned income as in a Chapter 13.

That being the case, the question for ANY property belonging to a debtor (jewelry or otherwise) is: “What property is the Trustee entitled to liquidate for those creditors?”

The Trustee may liquidate property that is, in short, not exempt from the “Bankruptcy Estate” that is created when the debtor files the bankruptcy petition. The Bankruptcy Estate is a legal estate much like a probate estate that is administered by a state court when someone passes away without a proper will having been written. In a probate matter, the state court determines the disposition of the deceased’s property. In a bankruptcy, the federal bankruptcy court, in the person of the trustee, determines the disposition on behalf of the creditors. Everything in the Bankruptcy Estate is able to be liquidated by the Trustee, and all of the debtor’s personal property and other assets are automatically part of the Estate—unless they are specifically, item by item, exempted from the Estate through the use of various exemptions that are provided in the Bankruptcy Code.

One of the more specific exemptions available in the Code is the exemption for a person’s jewelry.

The Federal exemption for jewelry is currently $1350.00. Jewelry that is higher in value than that amount may, in some cases, be covered by the “wildcard” exemption that is available to some debtors not utilizing their full homestead exemption. Otherwise, it may not be fully exempt and may be subject to liquidation by the Trustee.

The exemption for jewelry in Michigan, where I practice, is lower still: the Michigan exemptions (which be used instead of the Federal exemptions) provide for an exemption of just $3000.00 for ALL household goods, utensils, books, appliances, and jewelry—with the further provision that no one item be worth more than $450.00.

Therefore, the answer to the question of whether or not you may keep your jewelry in bankruptcy is, in a Chapter 7 bankruptcy, maybe. It depends upon the value of your jewelry and the availability of the “wildcard” exemption after the home you live in and all of your other personal property is taken into account and also whether or not you are using the Federal or state exemptions for your area. Further, when it comes to engagement rings and jewelry of particular sentimental value, the Trustees in your region may be lenient about liquidating the property even if not exempt, but this varies wildly by region and is best not to be counted upon.

If you have questions about the possibility of retaining your personal property through a Chapter 7 or a Chapter 13 bankruptcy, please contact me at jhilla@aronofflinnell.com or (248) 977-4182 to schedule a free, initial consultation.

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Posted in Chapter 13, Chapter 7, Debt Listing, Joint Property, Marriage and Bankruptcy, Personal Property in Bankruptcy

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Do I Need to List All of My Debts in my Bankruptcy Petition?

Posted on January 11, 2010 | Leave a comment

First of all, Happy New Year! 2009 was a challenge for many of us, and, while economic forecasts for the coming year are swinging wildly depending on who is doing the forecasting, I wish all of my former, present, and future clients here in Detroit, Michigan the best 2010 possible.

The question I want to address here, in my first post of the year, is an extremely basic question but one which has been popping up a lot recently. Perhaps because of the economic climate, many of the potential clients I’ve spoken to have asked me about the possibility of leaving one debt or another off of the petition, such as a personal loan from a family-member or friend, or even a debt to a trusted doctor whose services they wish to continue using during and after the bankruptcy.

Unfortunately, the answer to the question is rather quick and easy from my point-of-view: no, you cannot knowingly exclude a debt from your bankruptcy petition. All known debts with a greater-than-zero balance must be listed and, in a Chapter 7, therefore discharged.  Failure to list all of your debts may result in your petition being dismissed entirely or in criminal fraud charges.

If you accidentally leave a debt off of the petition, it is a simple matter to amend the petition to include it prior to receiving your discharge. The court charges a small amount for amendments which add a creditor to your petition, however, the cost of which your attorney may pass back to you. If the debt is not listed but your discharge is granted with no assets to distribute to creditors (i.e., yours was a “no-asset” case), the debt is discharged regardless of not having been listed.

Needless to say, the best policy is to forget nothing and omit nothing and to never have to make such an amendment in the first place. Working patiently with your bankruptcy attorney, who cannot know anything about your financial state of affairs that you don’t tell him or her, is a must. Remember, although it can be aggravating to comb through your personal papers for what is needed to compile a bankruptcy petition completely and accurately, your attorney is there to help you, and it will all be worth it in the end when each of those debts is finally discharged.

If you are a Detroit-area resident of Michigan and would like to schedule a free, initial consultation, please contact me at jhilla@aronofflinnell.com or (248) 977-4182 to schedule a free, initial consultation.

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Posted in Bankruptcy Planning, Bankruptcy Process, Chapter 13, Chapter 7, Debt Listing, Medical Bills, Student Loans, What Do I Need to File?

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