When must I pay my creditors during a Chapter 11 bankruptcy?

When you file for Chapter 11 bankruptcy in Michigan, your creditors must be paid in a specific order. Depending on the type of debt you owe, you may be required to pay the creditors who have secured claims first. Secured claims are debts that are backed by collateral, such as a car or a house. These creditors have the right to take back the collateral if you are unable to pay the debt in full. Unsecured creditors must be paid in the order that they filed their claims in bankruptcy court. This usually happens after you have paid your secured creditors. Unsecured creditors are those who do not have collateral backing their debt. These usually include things like medical bills, credit card debt, and other miscellaneous debts. You may not be required to pay any of your creditors until your case has been approved by the court. At the end of the bankruptcy process, you may be required to make a repayment plan to pay some or all of your creditors. This plan will depend on the type of bankruptcy you filed and your financial situation. In short, you must pay your creditors in the order determined by the court. Depending on the type of debt and the specifics of your bankruptcy, you may not have to pay back all of your creditors or in full. It is important to understand your rights and options regarding debt repayment before filing for Chapter 11 bankruptcy in Michigan.

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When must I pay my creditors during a Chapter 11 bankruptcy?

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