Bankruptcy is not a moral event. It is a federal procedure with eligibility rules, and for a household carrying debt that no realistic payment plan can retire, it is usually the cheapest and fastest way to stop the bleeding. Zaarour Law is admitted to practice before the United States Bankruptcy Court for the Eastern District of Michigan and handles no-asset consumer Chapter 7 cases.
What filing does
- The automatic stay takes effect on filing, which generally stops garnishments, collection calls, lawsuits, and repossession efforts immediately
- Qualifying unsecured debt — credit cards, medical bills, personal loans, most deficiency balances, older utility and cell accounts — is discharged
- Most no-asset cases close within roughly four months of filing
- You keep property that fits within the applicable exemptions, which for many filers means keeping the home and the car
What it does not do
Chapter 7 does not discharge most student loans, recent taxes, child support, spousal support, criminal restitution, or debts incurred through fraud. It does not strip a lien from collateral you want to keep — a secured car loan still has to be paid or the car surrendered. And it appears on a credit report for years, though for most filers the score damage from the underlying delinquency has already happened.
If a garnishment has already started, the timing of a filing matters. Wages taken before filing are usually gone. Speed is worth an early phone call.
How a case runs
- Eligibility. The means test compares household income to the Michigan median for your household size. Below it, you generally qualify. Above it, deductions may still get you there — or Chapter 13 may be the better structure.
- Preparation. Schedules of assets, debts, income, and expenses, plus a credit counseling course from an approved provider.
- Filing. The stay attaches. Creditors are notified and contact is supposed to stop.
- Meeting of creditors. A short examination by the trustee, typically about a month after filing. Creditors rarely appear.
- Discharge. A second financial management course, then the discharge order.
Fees
Fee arrangements depend on the matter. The firm will explain how your matter would be billed, and what it is likely to cost, before any work begins — not after. Note that the court filing fee and the two required course fees are separate from any attorney fee. The firm will also tell you at the outset whether Chapter 7 is the right fit — and will say so if it is not.
Common questions
Will I lose my house or my car in Chapter 7?
Most no-asset filers do not. Exemptions protect equity up to set amounts, and secured debts you keep paying generally stay in place. Whether your equity fits within the exemptions is one of the first things the firm checks.
Does bankruptcy stop wage garnishment?
Filing triggers the automatic stay, which generally halts garnishment going forward. Money already withheld before filing is typically not recoverable, which is why timing matters.
How much does Chapter 7 cost?
There is a court filing fee set by the bankruptcy court and two required course fees, both separate from any attorney fee. The firm will explain the whole cost after an initial review so there is no uncertainty.
Will my employer or my landlord find out?
Bankruptcy filings are public records, but there is no notice sent to your employer in an ordinary Chapter 7 unless wages are being garnished and the garnishment has to be stopped.
Speak with the firm about this
Describe the situation and any deadline. The firm responds to time-sensitive matters the same business day.