Answers to Common Questions about Arizona Bankruptcy Laws
If you’re looking into filing for bankruptcy in Arizona, you likely have a host of questions. It’s not a small decision and it’s one that you’ll want to evaluate with outside experts that can help you better understand the impacts of the decision.
Arizona law has some nuances to it when it comes to filing for bankruptcy and understanding these nuances in depth can help you make an informed decision. We’ll cover your top questions and answer them in simple form so that you can take the best step toward your financial health moving forward.
How can filing for bankruptcy improve your financial situation?
When you file for bankruptcy, you get to restart your finances. With most types of debt, you’ll no longer have a legal obligation to pay them off. Plus, you’ll get to enjoy the benefits of no longer receiving countless calls from debt collectors.
Additionally, those debtors will no longer be permitted to foreclose on your assets or garnish your wages. Going through bankruptcy is sort of like a pause to all your financial woes as you go through the filing process.
What are some of the things bankruptcy does not help?
Bankruptcy does not eliminate all types of debt, so depending on your situation, it is not a fix-all. If you owe debts to secured creditors – those who offer loans on property such as homes or vehicles – you’ll likely not be freed of those debts through the bankruptcy process. In these situations, you might be able to restructure your loan to help out with the repayment process, but it won’t fully eliminate the debt.
In addition to secured creditors, you’ll likely also still owe any back taxes, student loans and court fines. Plus, if you incur debt after you file for bankruptcy or that you omit from your bankruptcy filing, you’ll still need to repay those debts.
You’ll also find that in some cases, your co-signer on certain loans can be left responsible for your debts even if you are cleared from them in the bankruptcy process.
Is there a requirement of how much debt I must have to file bankruptcy in Arizona?
Most experts suggest that you have at least $15,000 in debt before you consider bankruptcy. While you can technically file with less debt than that, the risks outweigh the benefits in these situations. You’ll find that the harm that filing for bankruptcy does to your credit is not worth going through the process for.
Plus, if you have less than $15,000 in debt, you might go through the whole process of filing for bankruptcy only to be denied by the courts because your debts are so small. Many factors contribute to whether or not you’re an ideal candidate for bankruptcy, including:
- How long it would take to pay back the debt
- Whether your wages are being garnished
- If you have retirements savings you could use to pay off the debt
- If you’re facing home foreclosure
- You are retired or preparing to retire where your fixed income would not allow for loan repayment
- You feel extremely harassed by debtors and can’t live a happy life due to those constant calls
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What do I need to provide my lawyer to prepare my Arizona bankruptcy filing?
A bankruptcy attorney will need all of your available financial information to begin a bankruptcy filing for you in the state of Arizona. Your financial information includes more than just the debts you owe. Be prepared with income statements as well because these will help your attorney determine if bankruptcy is the right move for you and what type to file.
It’s essential that you include all your debts in a filing as they cannot be added later. If left off, they won’t be part of your bankruptcy filing.
If you’re unsure about what next steps to take in your bankruptcy filing, you should find a good Arizona bankruptcy attorney who can assist you with the process.
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