Detroit Bankruptcy Trial Comes to an End
The historic bankruptcy trial for the city of Detroit held its last hearings at the tail end of October, and now creditors, politicians, businesses, and the public all await the judge’s final ruling on November 7 to see if the city can drop $7 billion of its total debt of $18 billion.
The bankruptcy, which was first filed in July 2013, was the city’s final option to save itself from caving in to intense debt. After 15 months of hearings and negotiations, the trial has finally reached the end, and now all that’s left is for U.S Bankruptcy Judge Steven Rhodes to determine if the plan offered by the city is feasible and fair.
One of the biggest problems for coming to an agreement, especially to reassure judge that the plan would be fair for all, is that the creditors aren’t merely suits looking for money – they are retirees, pensioners who’ve seen the benefits they were owed for their service to the city receive steep cuts.
Throughout the 15-month trek of the bankruptcy filing, there have been about 150 court-ordered mediations to come to agreements with creditors. Yet, despite the rough path the city has taken, Bruce Bennett, a bankruptcy attorney with law firm Jones Day who presented the closing arguments, states that final bankruptcy plan is largely accepted by both the city and creditors.
A key issue for the plan is to keep the city alive and able to attract cash-flow from tourism. To do this, they needed to protect their city’s art, the pieces of work that defined the city and its people. Rather than selling masterpieces from the Detroit Institute of Arts, the DIA will pitch together with the state and other foundations in order to help compensate creditors. The city is also looking into ways to creatively utilize the multitude of Detroit’s abandoned properties to help repay creditors, as well.
For now, however, the planning is done, and the hearings are completed. From here, everyone waits with bated breath to see what the judge has to say.
If you are overwhelmed by your own tallies of debt, bankruptcy could be your best option to regain your financial footing. Filing for bankruptcy would give you the security of knowing your home and car won’t be taken from you while you adjust your debts into manageable repayment plans. Some debts might even be wiped away completely.
If you’re tired of overburdened by debt, give us a call and speak with one of our experienced bankruptcy attorneys. You deserve to have financial security, and we will help you seize that right.
