Michigan Bankruptcy Lawyers - What is a discharge in bankruptcy?:
Under 11 U.S.C. 727, a discharge is a release of liability in favor of the debtor and bankruptcy lawyer that applies only to specific debts that are listed within the schedules filed with the court. Debts that must be listed within these schedules include most common consumer obligations: loans, notes, credit cards, accounts payable, bills due, and contractual obligations. A discharge terminates liability for obligations. No further payment are required after discharge. An order of the court granting a discharge to the debtor and their bankruptcy lawyer acts as a federal injunction directed to each listed creditor and their bankruptcy lawyers, prohibiting further action to collect the debt, claiming the debt, or representing to any person or organization that the debt remains valid. Lawsuits are banned. All actions for collection are prohibited, including all phone calls requesting payments of any kind.
Michigan Bankruptcy Lawyers - Collateral:
Be aware that debts secured by valid liens on collateral are not fully discharged. Creditors and their bankruptcy lawyers retain rights to recover collateral, up to the value of the lien, but may not collect any amount owed beyond the lien value. In the most basic sense, a bankruptcy discharge charges off only unsecured obligations, including the unsecured portion of debts secured by collateral. Debtors and their bankruptcy lawyers may selectively choose to repay any debt after discharge. Post discharge payments are voluntary. A post-discharge payment of a portion of a discharged debt, if made, does not act as a reaffirmation of the debt and no further payments are required.
Bankruptcy lawyers must carefully review each debtor's financial affairs before suggesting any particular remedy. Because each client is unique, all alternatives may not be available. Also, bankruptcy lawyers often offer different opinions regarding available alternatives in the same circumstance, based on each bankruptcy lawyer's personal level of legal expertise. All potential debtors should consider the opinions of at least two, and preferably three consumer bankruptcy lawyers to discover all available alternatives.
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