Considering Filing Chapter 13 Bankruptcy in Michigan? Here’s What You Need to Know

Thinking about filing Chapter 13 bankruptcy? You’re not alone.

Many hardworking Michiganders feel overwhelmed by debt, creditor pressure, and difficult financial choices. If you’re worried about losing your home, falling behind on bills, or just feeling stuck — there is a way forward.

At Acclaim Legal, we bring over 20 years of experience and more than 120 years of combined legal expertise specializing in Chapter 13 bankruptcy and debt management. We understand the complexities you’re facing and are dedicated to providing clear, honest answers without confusing legal jargon. Our goal is to give you real support that helps you breathe easier and feel more in control.

Here are the 10 of the most common questions we hear from people just like you — to help you understand if Chapter 13 bankruptcy might be the fresh start you’ve been looking for.

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1. What is Chapter 13 Bankruptcy and How Does It Work?

Chapter 13 bankruptcy is a legal process that allows you to keep your home, car, and other assets while you repay debt through a structured, court-approved plan — typically over 3 to 5 years.

It allows you to:

• Stop foreclosure or repossession
• Catch up on missed mortgage or car payments — without late fees or added interest
• Consolidate your debts into one manageable monthly payment
• Protect your property while receiving court protection from creditors

It’s often called the “wage earner’s plan” because you need a regular income to qualify. Chapter 13 gives you a path to regain control of your finances — without losing what matters most.

2. How Long Does Chapter 13 Bankruptcy Take?

Most Chapter 13 repayment plans last 36 to 60 months — that’s 3 to 5 years. The exact length depends on your income, living expenses, and the amount of debt you need to repay.

The good news?

• Plans can be adjusted if your circumstances change
• Some people finish early or may qualify to convert to Chapter 7
• Every plan is personalized to fit your financial situation — not a one-size-fits-all approach

It’s a structured timeline designed to help you get back on track at a pace you can manage.

3. What Debts Are Included in Chapter 13?

Your Chapter 13 repayment plan can cover a variety of debts, including:

• Unsecured debts like credit cards, medical bills, personal loans, and past utility bills
• Secured debts such as mortgage arrears, home equity loans, car loans, and overdue property taxes
• Priority debts including IRS tax obligations and child support arrears

While most student loans aren’t discharged through bankruptcy, they can still be managed within your plan — giving you the flexibility to prioritize which debts to pay first.

4. Will I Lose My House or Car If I File Chapter 13?

In most cases, no! One of the biggest benefits of Chapter 13 is that it helps you keep important assets like your home or car — especially if you’re behind on payments.

The simple rule is: if you can afford to keep it, you usually can. When your plan is filed on time, Chapter 13 lets you catch up on missed mortgage or car payments over time, which can stop foreclosure or repossession.

Unlike Chapter 7 bankruptcy, which limits how much property or equity you can protect, Chapter 13 doesn’t require you to give up your assets. The trustee isn’t looking to sell anything. The entire purpose of a Chapter 13 plan is to protect your property while giving you a manageable way to repay your debts.

5. What Does It Cost to File Chapter 13 Bankruptcy?

Here’s a general breakdown of typical costs:

• Court filing fee: $313
• Credit counseling + credit report:
  • $75 for individuals
  • $120 for joint filers
• Attorney fees: Usually built into your monthly repayment plan

Your monthly payment is based on your specific situation — including your income, household size, types of debt, and other factors. During your free consultation, we’ll go over the details and give you a personalized estimate so you know what to expect.

6. Who Qualifies for Chapter 13?

To file Chapter 13, you’ll need to meet a few basic requirements:

• Regular income — This can include wages, a working spouse’s income, unemployment, disability benefits, child support, alimony, pension, or Social Security.
• Unsecured debt (like credit cards or medical bills) must be under $465,275 (as of 2025).
• Secured debt (like mortgages or car loans) must be under $1,395,875.

Not sure if you qualify? That’s what we’re here for. We offer free consultations to help you review your situation and walk through your options.

7. How Does Chapter 13 Affect My Credit?

A Chapter 13 bankruptcy stays on your credit report for 7 years, but it’s most often less damaging than people fear.

In fact, many people see their credit start to improve during the repayment plan because:

• Their total debt goes down
• Late payments stop
• Collections and lawsuits are paused or eliminated

We’ve had many clients qualify for refinancing, car loans, or even mortgage modifications while still in their Chapter 13 plan. It’s not a financial dead end — it’s a fresh start.

8. What’s the Difference Between Chapter 7 and Chapter 13?

Chapter 7		Chapter 13
Wipes out most unsecured debt entirely	Repays debt over time through a court-approved plan (often reducing what you owe)
Usually completed in 3–5 months	Typically lasts 3–5 years
Best for those with lower income and few assets	Ideal if you have steady income or want to catch up on your mortgage or car loan
May require selling non-exempt assets	Allows you to keep all assets by committing to repayment

Both Chapter 7 and Chapter 13 offer protection from creditors as soon as you file — stopping collections, lawsuits, garnishments, and harassment. And both end in a bankruptcy discharge, which legally wipes out qualifying debts and gives you a fresh financial start.

Not sure which is right for you? We’ll walk you through both options during your free consultation to help you choose the best path forward.

9. Can I File Chapter 13 Without a Lawyer?

Technically, yes — but it’s not recommended.

Chapter 13 involves complex paperwork, strict deadlines, and detailed legal requirements. A small mistake can delay your case, get it dismissed, or even put your property at risk.

Having an experienced Michigan bankruptcy attorney makes the process smoother, less stressful, and far more likely to succeed. In fact, it’s common for trustees to advise people filing on their own (“pro se” filers) to seek legal help before moving forward with the case.

If you're serious about getting a fresh start, having the right guidance matters.

10. What If I Miss a Payment?

Life happens — job changes, medical bills, unexpected expenses. The most important thing is communication.

If you miss a payment, let us know right away. In many cases, we can ask the court to excuse a missed payment or help you get caught up.

If your financial situation has changed more permanently — like a drop in income or increased expenses — your Chapter 13 plan can be modified to reflect your new reality. These plans are designed to be flexible over the 3–5 year repayment period, so you're not locked into something that no longer works for you.

We’re here to help you adjust and stay on track.

The key is open communication. We’re here to help adjust your plan, not punish you for life’s curveballs.

We're Here to Help — Free Chapter 13 Consultation in Michigan

Navigating Chapter 13 bankruptcy may feel overwhelming, but you don’t have to do it alone. At Acclaim Legal, our experienced Michigan bankruptcy attorneys are here to help you understand your options, craft a plan tailored to your needs, and guide you through every step with honesty and integrity.

If these questions sound familiar, you’re in the right place. We’ve helped thousands of Michiganders find the relief they need.

• Free consultations — no pressure, no judgment
• Local, experienced attorneys who specialize in Chapter 13
• Compassionate guidance from start to finish

Let’s explore your options together. Schedule your free consultation online or call us at 866-261-8282. We offer both phone and in-person consultations at any of our seven Michigan office locations: Detroit, Lansing, Ann Arbor, Flint, Warren, Southfield, and Dearborn.

Let us provide you with clear answers and a personalized assessment — so you can move forward with confidence and peace of mind.