Behind on the car payment.
When Is It Too Late To File For Bankruptcy In Michigan?
Don’t be afraid, like the chicken in the picture, to talk to an attorney.
BEFORE something happens.
Michigan allows foreclosure by advertisement, the usual choice of mortgage creditors.
A notice is published, virtually always in the Legal News, for four consecutive weeks with the sale date.
The notice is also posted on your house and/or mailed to you.
Or, judicial, in which case you are served with a complaint and summons that have been filed in the circuit court for the county in which you live.
Bankruptcy stops ALL collection actions, in their tracks.
So, if you file any chapter bankruptcy BEFORE the foreclosure sale date, the sale is stopped.
If you file during a judicial foreclosure suit, the suit is stayed, or stopped.
If the sale already took place, or the foreclosure suit judgment against you has been signed by the judge, too late.
A creditor lawsuit for money is stayed just like a judicial foreclosure suit, stopped wherever it is.
If not filed yet, it cannot be. If filed, no further action can be taken by the creditor against you.
But, if the judgment was already signed by the judge, you lose. This does NOT help the creditor though, because execution on that judgment is stayed by the filing of bankruptcy.
Unfortunately, Michigan allows wage garnishment.
DO NOT BELIEVE COLLECTION AGENCIES!
There can be no garnishment until after there is a judgment against you.
That is, until you have been sued and lost. Because a garnishment is a post-judgment action.
Your employer receives copies of the garnishment for you, and to fill out indicating whether it owes you any money.
Up to 25% of take home pay can be garnished.
One garnishment is good for 90 days.
But, if you file bankruptcy, garnishments must stop.
Same with a vehicle repossession. No matter how many payments you miss, filing bankruptcy imposes a stay on any creditor, and vehicles, or any other property, cannot be repossessed.
We are talking about a temporary stay; filing bankruptcy does NOT mean you can keep all your stuff without paying for it.
Always check with the expert. Before someone knocks at the door or your boss calls you into the office.