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Michigan Median Income Levels Change on November 1, 2010

The “New” Bankruptcy law from 2005 establishes a median income to determine whether you can file a Chapter 7 or whether you have to consider filing a Chapter 13. The median income is calculated on a State by State basis and is further determined by household size–just think of “heads on the beds.” As you may have guessed, things in Michigan are getting worse and the median income thresholds are decreasing.  Effective November 1, 2010, the Median Income figures for Michigan will change as follows: Household Size               Old                       New 1 person:                        $43,456 DOWN to $41.875. 2 persons:                       $52,433 DOWN to $49,919. 3 persons:                       $61,517 DOWN to $59,190. 4 persons:                       $74,558 DOWN to $70,600. 5 or more:  Add $7,500…

Doesn’t the new law prevent me from filing bankruptcy?

No. You can still file bankruptcy under the new law. The new law imposes some additional requirements including credit counseling and a financial management course. The new law also requires you to complete a means test if you make more than the median income. If you make too much money, you may have to file a Chapter 13 rather than a Chapter 7.