When you are overwhelmed by debt, you can find yourself getting behind on all of your obligations. What started as the occasional late credit card bill may now have snowballed into delinquent auto and mortgage debt and even late child support payments.  When your debts have become this unmanageable, filing for bankruptcy may provide welcome relief and the fresh start you need. When it comes to child support arrears, however, there are specific rules you need to know.

In Michigan, parents are legally required to support their children. After a divorce or when unmarried parents separate, the family court will ordinarily issue an order which sets out how much an obligated parent will have to pay to the other parent for their child’s care and needs. If a parent fails to pay this support, he or she could face legal consequences, attorney’s fees, and fines. 

Michigan bankruptcy law is unambiguous; Child support arrears cannot be discharged in Chapter 7 or Chapter 13 bankruptcy. One of the primary benefits of bankruptcy is that once you file the automatic stay goes into effect. The stay protects the filer from debt collection efforts and stops most legal actions such as lawsuits to collect what is owed while the bankruptcy case is being resolved. This benefit does not extend to child support debt.

Although there are specific limits on child support arrears, bankruptcy may still be a good choice when you are struggling to pay your support obligation. Child support obligations are considered “priority” unsecured debts in bankruptcy which means payment of this kind of debt will take precedence over other non-priority unsecured debts such as credit card and medical bills. Under Chapter 7 all of your qualifying assets will be liquidated and sold to pay your eligible debts. Your priority unsecured debts such as child support have to be wholly paid before the non-priority creditors get anything. Under Chapter 13, your child support debt can be included along with your other liabilities as part of your repayment plan. The plan will last 3 to 5 years which will give you time to catch up on your arrears at a significantly lower interest rate. The child support debt will have to be repaid in full by the end of 5 years.

Getting behind on child support and other debts can be daunting but, with the help of an experienced bankruptcy attorney, it is possible to gain control of the situation and get back on track. We have experience helping our clients find ways to manage their debts and start fresh. Please contact us online or by phone at  517-459-9518  if we may be of assistance.