Arizona Bankruptcy FAQs

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Bankruptcy is a legal process that personally releases Arizona individuals from any liability on their debts providing them with a fresh start. Are you having difficulty paying your bills each month? Are you drowning in credit card debt, high car payments, falling behind on your mortgage or simply treading water while never getting ahead? Are you afraid you will never be able to retire? Bankruptcy may be an option for you.

1. What are the different types of bankruptcy?

Chapter 7, allows individuals to discharge their debts in a short period of time as long as they meet certain income requirements. In most cases, you will receive a discharge within 3-4 months of filing your case.

Chapter 13, allows individuals keep their assets and property while paying only the amount of debt that they can reasonably afford based on their income and expenses. Chapter 13 allows individuals to catch up on mortgage arrears; support arrears; taxes; and vehicle payments and other secured debt over a period of 3 to 5 years. Additionally, a Chapter 13 allows individuals to “strip” a 2nd mortgage from their home and can provide relief from certain debt obligations incurred in a divorce.

2. Do I have to give up all assets?

Most individuals are able to keep everything they own. Bankruptcy law allows individuals to keep certain assets like retirement accounts, household goods and furnishings, equity in a home or vehicle and other types of while still getting a discharge of all debts.

It is very important to consult with our experienced bankruptcy attorneys before filing to determine what assets may be subject to turnover to the bankruptcy court. Our experienced bankruptcy attorney will review your financial situation and plan a strategy to allow you to keep most if not all of your assets while being discharged personally from your debts.

Planning a bankruptcy filing is critical and we will help you maximize the benefit a bankruptcy can provide.

3. Will all my debt be discharged?

All debt discharges unless specifically exempted from discharge under the bankruptcy code; or unless a creditor specifically objects to the discharge of a particular debt. Examples of debts exempted from discharge include:

– Domestic support obligations such as child support or alimony,
– Certain tax debts,
– And student loans.

Most tax debt is dischargeable as long as specific statutory requirements are met. Again, planning is critically important when attempting to discharge tax debt.

4. Can I still get credit afterwards?

Most people who file for bankruptcy are surprised by how quickly they start getting credit offers in the mail. It is very common for car dealerships and furniture stores to work with individuals after filing bankruptcy. On-time payments on these post-bankruptcy obligations are reported to the credit bureaus and help you improve your credit score!

Bankruptcy rules and regulations vary from state to state. Contact Lerner & Rowe Law Group at 602-667-7777 or by submitting an online form to get experienced help with your Arizona bankruptcy filing.