What is the Difference Between a Debt and Bill?
Most of us talk about our bills and debts as if they’re the same thing. The truth is that there’s a big difference between the two. Yes, when it comes to both debts and bills, it’s about you owing people money. However, for bankruptcy purposes, they are very different things. Your bankruptcy lawyer in Arizona will need you to help them figure out both of these things.
Your monthly bills are the recurring expenses you have to pay every month. This includes things like rent, utilities and a cell phone bill. They are bills that are paid every month and never really go away. No matter how many times you pay your monthly bills, they always come back.
Debt is something else. When you owe debt, you owe a certain amount of money to a creditor. Every time you make a payment toward your debt, the balance goes down. The exception to this rule is if you’re paying so much in interest every month that the balance never goes down or only goes down by a few dollars.
It wouldn’t be fair to say that the bankruptcy courts don’t care about your monthly bills. However, what they’re really concerned with are your debts. If you feel your debts are starting to get out of hand, then it may be time to talk to a bankruptcy attorney in Arizona. If your monthly bills are out of hand, it may be time to change your lifestyle.
Why Does it Matter?
When you write out your bills every month, it probably doesn’t matter to you whether you’re paying a monthly bill or a debt. However, it matters a lot to the bankruptcy courts, they want to look at how much debt you’ll be asking the courts and creditors to wipe out. If the trustee isn’t convinced that you truly can’t afford to pay back your debts, then one of two things will happen. They may dismiss your bankruptcy all together. Or they may force you to amend your petition to a Chapter 13.
If Your Debts are Low but Your Monthly Bills are High Bankruptcy May Not Be Your Best Option
As mentioned earlier, if your debts aren’t that high, you really shouldn’t file bankruptcy. It could just be a matter of changing your lifestyle a bit. Perhaps all you have to do is get a car with a lower monthly car payment. Or you may need to move to an area with lower rent. Sometimes, these kinds of changes can solve more of your problems than you think. It can be a lot easier to change a few of your monthly bills than it is to file bankruptcy. Plus, it won’t be as devastating to your credit.
Speak with a Seasoned Bankruptcy Lawyer in Arizona Today
If you’re at the point where you’re talking about filing bankruptcy, then it’s gone beyond the point of tightening your belts. People don’t consider bankruptcy unless they truly don’t know what else to do. What you should do is call and talk to an experienced bankruptcy lawyer in Arizona. They can review your debts and answer any questions you may have. You may find out that things aren’t as bad as you think they are. Or you may learn that bankruptcy is the best thing for your family at this time. The best thing for you to do is to call and set up a date and time to meet with one of our attorneys.