Filing for bankruptcy in Arizona is not as simple as one might assume. The first and perhaps most important decision before filing for bankruptcy is deciding under what chapter should you seek protection. On the personal level, an individual can choose between Chapter 7 and Chapter 13 on the Bankruptcy Code. Because this choice has a significant impact on your future, you should meet with experienced bankruptcy attorney Clint W. Smith before filing for bankruptcy in Arizona.
A Chapter 7 bankruptcy proceeding calls for an almost total liquidation of your assets to pay off all or almost all of your creditors. Chapter 7 bankruptcy may not pay all creditors the entire amount they are owed, but most creditors usually receive something.
Before filing for Chapter 7 bankruptcy in Arizona, you must meet these threshold standards:
In addition to these thresholds, you must be able to show that your average monthly income over the previous five years is less than $11,725 or that your average monthly income over the past five years is less than 25 percent of your unsecured debts.
A Chapter 13 bankruptcy petition is very different from a Chapter 7 proceeding. Chapter 13 does not automatically call for the sale of your assets so that your creditors get paid. Instead, a Chapter 13 proceeding attempts to work out and renegotiate your debts and liabilities in a reorganization plan. A Chapter 13 bankruptcy filing requires you to submit a payment plan acceptable to your creditors. Filing for Chapter 13 bankruptcy in Arizona requires the debtor to:
Before filing either Chapter 7 or Chapter 13 bankruptcy in Arizona, a debtor should contact an attorney experienced in both areas to get advice on the best option to use.
The bankruptcy law firm of Clint W. Smith, P.C. can help. Contact our Mesa, Arizona office at 480-807-9300 or toll free at 877-290-9493. Our firm serves the surrounding areas of Chandler, Tempe, Gilbert, Scottsdale, and Mesa in Arizona.
“We are considered a debt relief agency under the Bankruptcy Code. We assist people in filing for bankruptcy relief.”
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